Investors are expecting the United States to be in for a cold winter this year and natural gas prices have responded in kind. Bloomberg reported that natural gas futures in New York rose to their highest price in the last 12 weeks on the speculation that this winter will drive strong demand for the heating source.
"The price rally we've seen over the last several days has been turning on the potential for intense weather in October," said John Kilduff, partner at Again Capital LLC and editor of the Energy OverView newsletter in New York. Markets are already taking notice of the early rise in heating demand, he added.
According to Bloomberg, natural gas for November delivery rose 3.8 cents, or 0.9 percent, to $4.159 per million British thermal units at 9:25 a.m. on the New York Mercantile Exchange after reaching $4.184, the highest intraday price since July 10 of this year.
Investing.com added that the Midwest can expect to see some of the coldest temperatures, and thus it will be a hotbed of natural gas demand. Despite early concerns about supply, recent injections of gas into storage have surpassed the five-year average for 23 consecutive weeks, cutting down the deficit of U.S. natural gas in storage and assuaging the worries about dwindling stores of natural gas.
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