NYMEX Gas Futures Hit $4.995 on Cold Forecast; M-U Spot Avg $4.74

Yesterday, the NYMEX "front-month" futures price for natural gas closed up 15 cents at $4.995 (call it $5), which is the highest closing price for NYMEX in nearly three years (since Dec. 27, 2022). Intraday trading of the front-month contract floated above $5 at points. Weather forecasts of impending frigid weather were the main reason for the increase. Futures prices are now up more than 60% compared with a year ago. “Forecasts for the coldest December since 2010 may tip storage into a deficit by Christmas,” trading firm EBW Analytics wrote in a note to clients. Fewer molecules with more demand equals higher prices. As for the spot price at trading hubs in the Marcellus/Utica region, averaging all of them together, the price closed yesterday at $4.74, nearly at parity with the Henry Hub spot price of $4.87. That's unheard of!

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