Natural gas spot prices fell in three of the five trading sessions this week. A cold weather front in the Midwest was not enough to offset several factors contributing to the lowest prices since last summer. The traditional heating season has only six weeks remaining, yet inventory levels are viewed as ample. The national inventory level is 43.9 percent above the five-year average. Prices for competing fuels have fallen due to the lack of sustained cold temperatures this winter. On February 15, the natural gas spot price at the Henry Hub had fallen 57 cents from last week, or seven percent, to $7.31 per million British thermal units (mmBtu). On Tuesday, February 14, the average price at the Henry Hub was $7.03 per mmBtu, the lowest price since July 1, 2005. This Wednesday's price of $7.31 was $1.30, or 22 percent, above last year's level of $6.01 per mmBtu.
Shut-in natural gas production in the Gulf of Mexico was 1.554 billion cubic feet per day as of Wednesday, February 8, down from its level on January 25 of 1.656 billion cubic feet per day.
The amount of natural gas in storage in the East Region decreased 5.3 percent to 1,249 billion cubic feet for the week ending February 10, which was 375 billion cubic feet above the 5-year average. Nebraska is a part of the East Region (see map) which is a major natural gas consumer, particularly in the residential and commercial sectors. The industrial sector, which includes agriculture, is also a major consumer in this state. Most of the gas is supplied from the Producing Region with a fair amount imported from Canada. The Henry Hub in southern Louisiana is a major market center with interconnections for many of the pipelines that transport U.S.-produced gas to the East Region. Furthermore, the Henry Hub is the preferred reference point for prices for most of the domestic gas destined for the East. Therefore, market conditions and developments in the East Region and price movements and trends at the Henry Hub are usually highly correlated.
Notes: An archive is available. Divide the price by ten (10) to obtain the price per hundred cubic feet (ccf) or the approximate price per therm.