HomeArticlesRecent Trends in Natural Gas Market

Recent Trends in Natural Gas Market

1 min read

Kevin Green

Correspondent

Natural gas (/NG) has experienced strong buying pressure from the April lows as the injection season has begun and summer weather forecasts come more into focus. Natural gas is the most abundant resource in the United States, and improvements in shale extraction technology have significantly enhanced the extraction processes. In some regions, particularly in the northern United States, natural gas is flared due to a lack of infrastructure and high breakeven levels that deter infrastructure investment. This abundance has been a primary reason for downward price pressure over time. However, recently, a healthy bull trend has emerged in natural gas.

In the last two quarters, many U.S. natural gas producers have reduced their capital expenditure (cap-ex) spending guides for natural gas infrastructure to tighten supplies and stabilize prices. We may now be seeing the results of this throttling. Based on last week’s data from the EIA, net injections totaled 98 Bcf (billion cubic feet), which is 4.8% below the five-year average and 6.6% lower than last year’s level.

The market is also seeing continued rising demand for LNG, especially in the Asia-Pacific region. As capacity for LNG infrastructure comes back online, this may help stabilize natural gas prices through the summer months. Despite this, inventory levels remain elevated, with working natural gas stocks 25% higher than the five-year average and 15% higher than last year’s levels.

With short covering and positive supply developments for bulls keep your eye on the price action to see if this bull trend can continue.

Featured clips

Morning Minute: Friday, June 7

MORNING MINUTE

► Play video

CRWD Trades Rich Relative to Tech & HPE is Riding Coattails of Tech

MORNING TRADE LIVE

► Play video

The Market Has Moved Too Far & Too Fast

THE WATCH LIST

► Play video

It Makes Sense to Favor Stocks with Less Momentum & Cheaper Valuations

MARKET ON CLOSE

► Play video

Charles Schwab and all third parties mentioned are separate and unaffiliated, and are not responsible for one another's policies, services or opinions.

ON AIR
4:00 pm
Trading 360
replay
12:00 am
Fast Market
REPLAY
1:00 am
Trading 360
REPLAY
2:00 am
Next Gen Investing
REPLAY
education
3:00 am
Your First Trade
REPLAY
3:30 am
Trading 360
REPLAY
4:30 am
Next Gen Investing
REPLAY
education
5:30 am
Your First Trade
REPLAY
6:00 am
Fast Market
REPLAY
7:00 am
Futures
8:00 am
Morning Trade Live
10:00 am
Trading 360
11:00 am
Fast Market
12:00 pm
Next Gen Investing
1:00 pm
The Watch List
2:00 pm
Market On Close
3:30 pm
Market Overtime
REPLAY
ON AIR
4:00 pm
Trading 360
REPLAY
5:00 pm
Fast Market
REPLAY
6:00 pm
Next Gen Investing
REPLAY
7:00 pm
Market Overtime
REPLAY
education
7:30 pm
Your First Trade
REPLAY
8:00 pm
Trading 360
REPLAY
9:00 pm
Market Overtime
REPLAY
education
9:30 pm
Your First Trade
REPLAY
10:00 pm
Fast Market
REPLAY
11:00 pm
Trading 360
REPLAY

Get the Market Minute

Daily insights for every investor