Natural-Gas Prices Fall on Supply Worries
October 16 2019 - 2:52PM
Dow Jones News
By Sarah Toy
Natural-gas prices fell on Wednesday, underscoring investors'
concerns about a supply glut even as weather forecasts pointed to
cooler temperatures for parts of the country.
Natural-gas futures fell 0.9% to $2.510 per million British
thermal units after rising as much as 1.9% earlier in the day amid
predictions that lower temperatures would hit the Midwest and
Northeast in the next few days. Demand for natural gas tends to
climb when people use their heaters in the winter and air
conditioners in the summer, so changes in the weather and weather
forecasts can precipitate price swings.
However, expectations that the U.S. Energy Information
Administration, or EIA, would announce that domestic natural-gas
stockpiles had surged by a record amount last week seemed to
outweigh hopes of increased demand.
Analysts with Tudor, Pickering, Holt & Co., an
energy-focused investment bank, said in a Tuesday note that they
expected the EIA to say Thursday that natural-gas inventories had
increased by 117 billion cubic feet last week, making it the
largest weekly gain on record during the fall season.
Natural-gas stockpiles have been building for months, and
energy-advisory firm Ritterbusch & Associates said it
anticipates inventory will continue growing well into November and
possibly beyond that. The EIA expects 2019 dry natural-gas
production to average 91.6 billion cubic feet a day, a 10% increase
from the 2018 average.
Elsewhere in commodities, oil prices rose on Wednesday, with
U.S. crude futures climbing 1.1% to $53.40 a barrel, and Brent, the
global gauge of prices, rising 1.2% to $59.43.
Most-active gold futures rose 0.7% to $1,494 a troy ounce,
spurred by global economic worries, concerns over trade talks
between the U.S. and China and the possibility of further monetary
easing by central banks around the world. Lower rates make gold
more attractive to yield-seeking investors, as gold offers no yield
for simply holding it.
(END) Dow Jones Newswires
October 16, 2019 14:37 ET (18:37 GMT)
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