Since the beginning of last week (26th Sept) Natural Gas was trading at the $3.07 level, by the end of the week it plummeted 0.18c to a week-low of $2.95. Recent Natural Gas stockpiles increased to 49 billion cubic feet with total stockpiles currently at an average level of 3.5 trillion cubic feet.
The trend for Natural gas is far from bullish especially knowing that total storage level is up around 85 billion cubic feet from last year’s figures.
In summer months the demand for Natural Gas tends to be higher than usual due to increased usage for air conditioning. After this period demand tends to slowdown during the cooler months. Lower gas prices places even more pressure on oil and gas producers. This could also in turn affect the Russian economy, which has one of largest proven reserves in the world. Russian official reported that while market expectations in Europe has cooled, there has been significant rise in demand from Asian countries. Earlier in the year there had been some reports that Japan was ready to co-operate with Russia in multi-energy projects which could change the future prospects for Natural Gas.
Year on year price comparisons show average levels to be quite low, but based on this data, supply is high and demand is questionable.