Gas Prices Fall Across Markets As Inventories Robust

Gas prices were generally lower on Wednesday. European LNG traded in a narrow range but finished down 1.2% to EUR 30.61 after a low of EUR 30 and high of EUR 31.05. Inventory levels in most markets are above seasonal averages which weighed on prices. Europe is around 64% full. European demand is soft especially given the struggling industrial sector but with gas prices lower than coal’s it should remain supported.

• US natural gas fell 1.5% to $2.17 but is still up 9.2% this month. Storage levels are 35% above the 5-year average which is keeping a lid on prices. Inventories are expected to show an 87 bcf increase when they are released by the EIA later today.
• North Asian prices are 1.1% lower but still up 4.2% in May. China’s largest LNG importers are selling supplies suggesting current excess supply.