Commodities
Narrowing Surplus and Strong Demand Send Natural Gas Futures Higher
Natural gas futures rose early Friday as market participants evaluated the latest storage surplus and production levels.
A substantial storage surplus remains, but its narrowing size is a positive sign for the market. The surplus is currently at 5.2% above average, which is down from previous weeks. This reduction in surplus may indicate that demand will help to offset supply, leading to higher prices.
The production levels have been choppy, but they remain seasonally solid. In fact, September demand has held strong, averaging 112.5 Bcf/d. Additionally, robust late-summer cooling demand is supporting the market, and strong LNG volumes are also contributing to the rise in natural gas futures.