US natgas prices jump despite record stocks

01 November 2007 19:50  [Source: ICIS news]

HOUSTON (ICIS news)--US natural gas futures prices surged 30.7 cents (3.69%) to close at $8.637/m Btu on Thursday as traders shrugged off a record inventory report and bought supplies.

The Energy Information Administration (EIA) said on Thursday that natural gas inventories rose by 66bn cubic feet (bcf) for the week ended 26 October to reach 3,509 bcf, the highest stock level recorded. The previous record of 3,461 bcf was set during the week ended 20 October 2006.

Sources said colder temperatures in the US northeast and midwest and the psychological shift from fall demand to winter needs prompted market participants to ignore the record stocks and buy supplies.

The rally from the low of $8.231/m Btu, down 9.9 cents shortly after the EIA report was released, powered prices to $8.466/m Btu, up 13.6 cents within 30 minutes.

A later surge in buying pushed prices to $8.677/m Btu, up 34.7 cents, before easing on light profit taking for the remainder of the session.

By: Brian McIntyre
+1 713 525 2653

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