Natural Gas Prices Plummet to Multi-Month Low on Storage Report
Natural gas futures prices continued their downward trend on Thursday morning, reaching a fresh multi-month low of $2.642 per MMBtu after a 33 Bcf build in storage was reported.
The decline is not just a wobble, over the past month, the price has fallen 18.36%, and against the same point a year ago, it's down 13.09%. The contract has lost 41.9% since its two-year high near $4.55 in May.
The storage report was released at 10:30 a.m. ET, confirming that sellers had already decided on their move before the data arrived. A net injection of 33 Bcf for the week ended July 31 came in on the heavier side of consensus expectations for 31 Bcf, depressing bullish sentiment and weighing on futures.
The surplus is the structural fact that overrides everything else, working gas inventories are running approximately 6.4% above the five-year average, with a separate estimate putting stocks around 6.6% above normal for the week ended July 31. The cushion has been in place since March, built by strong output and mild spring conditions.