Natural Gas News – July 20, 2023
Natural Gas News – July 20, 2023
Natural Gas Forecast: Slightly Lower Following Intense Heat-Driven Surgery
Natural gas futures experienced a slight decline on Wednesday following a strong surge driven by intense heat the previous day. Despite the setback, prices have remained relatively stable, hovering around the mid-point of their 45-day range. The market has been characterized by low volatility, with historic 30-day close-to-close futures volatility at its lowest level since April 2022, marking a six-day streak. Throughout this year, historic volatility has averaged 84.5%, reaching a record high of 92.8% in 2022, with a five-year average of 57.9% (2018-2022). U.S. natural gas futures rose 4% on Tuesday, propelled by forecasts predicting hotter-than-normal conditions persisting until early August, particularly in Texas. This price increase occurred despite rising output, revised lower demand projections for the…
El Nino Likely to Boost Natural Gas ETFs in 2H23
Soaring temperatures have become the norm this year, with a frightening surge in some regions. The culprit? El Nino, a climate phenomenon characterized by an abnormal warming of the Pacific Ocean. Its effect, combined with climate change, has resulted in the warmest global temperatures on record (read: ETF Areas to Win on El Nino in 2023). Thanks to the intense heat, demand for air-conditioning has surged. With natural gas powering nearly 40% of U.S. utility-scale electricity generation as per the U.S. Energy Information Administration, the scorching heat mean a higher cooling demand and the resultant usage of natural gas. Last year, natural gas prices jumped to their highest level since 2008. After a protracted bearish trend, natural gas futures rallied from over $15 per metric million Br…
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