Gas prices chill in a warm winter
2023-04-28
Summary:
Experience the impact of current gas prices in a warm winter. Discover how the reduced demand is affecting the cost of gas and how it may impact prices.
Gas bulls are through a bitterly chilly winter, and perhaps the worse is yet
to come. On Monday US natural gases took a nosedive by 13% to their lowest in a
week and European wholesale gas prices fell by 3.5% as the mild weather is
expected to continue suppressing energy demand.
Natural gases have been tanking since the start of this year, down as much as 34%, a heavy blow to those speculating on a more sustainable upward spiral as the severe sanctions imposed on Russia resulted in evident supply disruption.
“With a little under a month left of winter, the upside demand risk from a prolonged spell of cold weather is diminishing,” Timera Energy said in a research note.
Gas producers are caught in such a U-turn that some of them are sounding a production alarm. That prices have been plunging should be interpreted as a ‘very clear signal’ of necessary production cuts for the US, said Chesapeake Energy CEO Nick Dell’Osso.
US natural gas production hit a record 39 trillion cubic feet in 2022, according to EIA, having doubled since 2006. It came as gas prices in June rose to a record high of over $5/gallon before a great pullback.
China, the largest gas importer, saw gas demand decline in 2022 for the first time in around two decades mainly due to high prices and weak local consumption. It is generally predicted that the demand is only going to slightly pick up in 2023 and the room of growth could be quite limited for the two years to come, according to the Caijing’s interview with several experts. BSC Energy, a leading energy consultant, even suggested China’s natural gas market could be at stake given renewable energy boom – a more self-dependent source of energy for the nation.
The dollar closed close to April lows on Wednesday
The dollar remained steady at its lowest level since April 12. Positive business activity in Europe in April impacted the greenback negatively.
2024-04-24
The euro firmed on Tuesday
The euro rose on Tuesday but faced its biggest monthly drop since January. Eurozone business surged in April with strong service sector growth.
2024-04-23
The yen barely moved in Asian trading on Monday
The yen stayed steady in Asian trading on Monday, while the US dollar held near five-month highs after last week's policy and geopolitical changes.
2024-04-22
