U.S. natural gas prices surged to within a few cents of $9 before closing Thursday +8.2% at $8.874/MMBtu (NG1:COM), the highest closing price since July 26, apparently at least in part due to talk of increased gas flows to the Freeport LNG export plant in Texas.
Officials at Freeport LNG said the company was still pulling in gas to feed a power plant that was generating electricity for the Texas grid since mid-July.
Mizuho director of energy futures Robert Yawger told Reuters the Freeport news “put a bid in the market.”
Also in the news was a leak affecting the Mars crude oil pipeline in the Gulf of Mexico, which caused a temporary shutdown of six oilfields in the Gulf.
The gas price increase came despite a larger than expected U.S. storage build of 44B cf, and as August temperatures have moderated slightly from July, reducing cooling demand.
Analysts at NatGasWeather.com noted that bullish investors bought when prices dipped after the storage report, and kept pushing the market higher into the close.
Freeport LNG, the second biggest U.S. LNG export plant, was consuming ~2B cf/day of gas before it shut by a fire on June 8; Freeport expects the plant to return to at least partial service in early October.
Image and article originally from seekingalpha.com. Read the original article here.