MARKET WATCH: Natural gas prices climb as Hurricane Dorian approaches
US natural gas futures prices rose Aug. 29, extending a recent rally as analysts monitored Hurricane Dorian’s approach.
US natural gas futures prices rose Aug. 29, extending a recent rally as analysts monitored Hurricane Dorian’s approach. It was expected to make landfall in Florida on Sept. 1 or Sept. 2 although forecasters expressed uncertainty on the storm’s path for landfall and after landfall.
The October gas price on the New York Mercantile Exchange increased 7¢ to settle at a rounded $2.30/MMbtu on Aug. 29, which marked the highest front-month price in more than 5 weeks.
Although Hurricane Dorian appears to pose little threat to oil and gas production in the Gulf of Mexico, it reminds traders that the Atlantic hurricane season remains active for weeks to come.
Hurricane season officials ends Nov. 30. “The peak isn’t until closer to mid-September,” said Marshall Steeves, energy markets analyst at IHS Markit. “Traders are now more sensitive to tropical developments.”
“The hurricane looks likely to make landfall in Florida and move north rather than into the Gulf from what I’ve seen, so [there’s] no reason to expect shut-in production from this,” said Steeves.
After moving across Puerto Rico and the British and US Virgin Islands, Dorian headed to open waters Aug. 29. The Category-1 storm was expected to intensify into a Category 3 or Category 4 hurricane by landfall in Florida.
Light, sweet crude oil on the New York Mercantile Exchange for September delivery increased 93¢ to $56.71/bbl on Aug. 29 while the October contract gained 85¢ to $56.45/bbl.
Ultralow-sulfur diesel for September increased 1¢ to $1.86/gal. The NYMEX reformulated gasoline blendstock for September increased less than 1¢ to remain at a rounded $1.68/gal.
Brent crude for October gained 59¢ to $61.08/bbl. The November contract added 56¢ to settle at $60.49/bbl.
Gas oil for September increased $2.25 to $571.75/tonne on Aug. 29.
The average for the Organization of Petroleum Exporting Countries’ basket of crudes for Aug. 29 was $60.24, up 8¢.
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