Natural Gas Prices Rebound Amid Record Shorts and Weakening Production

Natural gas futures rebounded on Wednesday, reclaiming the $3 mark as production sank to its lowest level since July. Short covering and colder overnight forecasts contributed to the price surge.

The latest data shows that speculator shorts sit at record levels, a factor that has weighed on prices in recent times. However, the weakest power burn since Labor Day has also added to the upward momentum.

At 109 Bcf/d, natural gas output dipped below its average level, providing further support to prices. Weather models are also indicating increased heating demand, which will likely boost consumption and drive up prices.