US natural gas prices enjoyed quite a run this summer, jumping more than 91% from a 25-year low on June 26th of $1.432/MMBtu to a late-August high of $2.743/MMBtu.
While that’s impressive, we’d caution about getting bullish on gas this year as we see little chance for sustained upside in US natural gas prices above the $2.75-$3.00/MMBtu range this winter. We continue to see a retest of this summer’s lows in gas, or even worse, as more likely.
The main driver of the surge in gas prices in recent weeks has been extraordinarily hot summer weather and strong cooling demand, particularly in the western states.
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Elliott and Roger on Sep. 27, 2022