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Mild Weather, High Stocks Weigh on US Natgas

NATURAL GAS

US Henry Hub prices have fallen to pandemic lows amid significantly milder weather in February, raising expectations of higher end of winter storage levels, JP Morgan said in a note.

  • US Henry Hub front month prices closed last at the lowest level since end-June 2020.
  • February weather is now forecast 615HDDs vs the ten-year average of 778HDDs.
  • The bank’s end-March storage trajectory is seen at 2.2Tcf and the end-October storage forecast is seen at 4.25Tcf.
  • US natural gas stocks stood at 2.535Tcf as of 9 February, the latest EIA data showed.
  • Regardless of higher storage forecasts an milder weather, the bank maintains the 4Q 2024 price forecast of $4/mmbtu and the cal25 price forecast of $4.75/mmbtu.

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