Natural gas continues to slide on larger-than-expected storage build.
Markets were closed in observance of the Juneteenth holiday.
When trading resumed, the Jul2022 NYMEX natural gas contract declined 13.6 cents to end the day at $6.808 per MMBtu as weekend weather forecasts called for temperatures to trend back toward normal for the end of June. The Jul-2022 WTI crude oil contract closed and expired $1.09 higher at $110.65 per barrel on continued market tightness after recent mobility data showed solid summer fuel demand. Equity markets bounced higher following the worst trading week in two years as investors waded into the markets to scoop up stocks at a discount.
Natural gas climbed 5.0 cents higher to $6.858 ahead of the next day’s storage report, which was expected to show a build in the mid-60s that would further widen the storage deficit. The new prompt Aug-2022 WTI crude oil contract fell $3.33 to $106.19 after the American Petroleum Institute reported an unexpected 5.61 million-barrel increase to oil inventories. Equities landed in the red after Federal Reserve Chairman Jerome Powell said the central bank was strongly committed to taming rising inflation, but that would elevate the risks of an economic downturn.
Natural gas tumbled 61.9 cents to settle at $6.239 after the EIA reported a higher-than-expected 74 Bcf build to storage, which gave the market the first glimpse of how the Freeport outage could influence future builds. Equity markets managed to erase early session losses despite continued concerns over Powell’s testimony that warned rapidly rising interest rates could pave the way for a recession. Crude oil lost another $1.92 to finish the session at $104.27 after the EIA’s weekly inventory report was delayed until the following week due to technical issues.
The cost of natural gas edged 1.9 cents lower to close at $6.220 as traders continued to contemplate how the Freeport LNG export facility outage would help balance supply and demand. Oil prices pushed $3.35 higher to $107.62 as traders looked ahead to the following week’s G-7 meeting for signs of additional sanctions against Russia’s oil exports. Equity markets soared higher even after a survey showed consumers expressed the highest level of uncertainty over inflation in 30 years.
Natural gas traders will pay close attention to the supply and demand balance with less supplies being shipped overseas.
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