Natural Gas Prices Plunge as Oil Surges
Natural gas prices plunged on Thursday as spring-like weather around the country raised expectations that demand would remain weak. The amount of natural gas in storage in the U.S. fell by 80 billion cubic feet to 2.433 trillion cubic feet last week, a figure that was 48.3 percent more than the five-year average, according to the Department of Energy.
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The price of natural gas fell 5.5 cents, or 2.4 percent, to $2.247 per 1,000 cubic feet in New York today, and has fallen 27 percent so far this year to the lowest level in a decade. Meanwhile, oil prices continue to rise on concerns about tensions between Israel, the United States, and Iran.
The mild winter, along with the desire to save money, had business owners and consumers alike keeping thermostats at lower temperatures, allowing natural gas stockpiles to expand as production boomed because new drilling techniques have given energy companies access to previously untapped underground reserves. Now producers are likely to decrease production because of the low price.
Meanwhile, oil prices continued to rise in trading today due to developments in the Middle East and Europe. Tensions over Iran’s nuclear program have already forced oil prices up 14 percent in the last four months. On Thursday, Israel said it was in possession of satellite images that proved Iran to be developing a nuclear weapon, further pushing up oil prices. Signs that a $140 billion bond swap deal to restructure Greece’s debt will succeed also supported oil prices.
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