Natural gas prices were up nearly 7% this morning to almost $US6/mmBtu on concerns of supply shortages as winter drags on.
They’ve been above $US5 for most of the past month, though had come down a bit recently. They are now within range of a four-year high set earlier this month.
Weather reports suggest that this week’s warm break will prove short lived, with temps likely dipping below freezing for much of the U.S. east of the Mississippi by Monday.
“Prices surged as the extreme weather conditions were centered in the most populated and user-heavy areas of the US, while inventories fell to below seasonal norms. Energy markets in the US remain set for another move higher should there be yet another wave of extreme winter weather blasting the northeastern and east regions,” TD Securities’ Bart Melek said in a note yesterday.
Until this week, natgas was the best-performing commodity of the year (commodities tend to be highly volatile).