A pier carrying liquefied natural gas in Japan, on December 17, 2021. If Japan withdraws from the Sakhalin energy projects in Russia and its shares are acquired by Russia or a third country, this would weaken the effectiveness of Western sanctions and benefit Russia, Japan’s industry minister said on Friday.
Kiyoshi Ota | Bloomberg | beautiful pictures
U.S. natural gas rose on Tuesday to its highest level in nearly 14 years as Russia’s invasion of Ukraine ravaged global energy markets.
Henry Hub prices rose more than 9% to $8.14 per million British thermal units (MMBtu) in morning Wall Street trading, the highest level since September 2008.
Campbell Faulkner, senior vice president and principal data analyst at OTC Global Holdings, said the move was due to “a range of tighter market conditions”, including the European Union’s review of the round. Friday’s sanctions against Russia, which could include the country’s energy complex.
In addition, production in the US is down and gas inventories are 21% lower than this time last year.
He added: “Electricity burn is higher this summer with coal air … the transition will reduce the amount of gas stocked to load into storage, which is driving prices up in the stock commodity cycle. dictionary (reversed) to get gas into the market”.
In the last two sessions, the price of natural gas has increased by more than 12%. The increase follows a nearly 30% increase in April. The rapid price action, which is also being fueled by surging demand for US liquefied natural gas, is adding to inflationary pressures across the economy. Consumer electricity bills are rising as utility companies shift to higher costs of their inputs.
EBW Analytics also shows that weather patterns change as driving natural gas demand as warmer temperatures lead to air conditioning season.
“Faster-than-expected hotter weather, however, is the main bullish driver as traders jump into the early Texas hot weather — and any hot weather patterns change.” further could pose a challenge to recent highs,” the company added.
Energy was the top-performing group in the S&P 500 on Tuesday, up more than 1%.