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Polar Vortex Drives Up Gas Prices, Iranian Deal Drives Down Crude

By  +Follow January 13, 2014 8:46AM
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ETFs tracking natural gas prices spiked Monday, following natural gas futures north as speculation that Thursday’s report on stockpiles from the Energy Department will show steep declines. Natural gas futures for Feb. 14 delivery were up over 4.75 percent Monday.

Gains for natural gas futures pulled up the major ETFs tracking natural gas prices, as well as companies extracting it. The United States Natural Gas Fund (UNG) jumped by more than 4.75 percent, the iPath Dow Jones UBS Natural Gas Subindex Total Return ETN (GAZ) climbed over 6.25 percent, and the United States 12-Month Natural Gas Fund (UNL) is up almost 3.5 percent.

Polar Vortex, Cold Weather Could be Spurring Demand

The winds that swept down from the north bringing sub-zero temperatures to most of the United States this last week also brought with them the chance that natural gas usage would increase dramatically. And, with MDA Weather Services predicting persistently lower-than-average temperatures, speculation appears to be raging among traders that the US Energy Department will report dramatically lower reserves on Thursday, driving up prices for natural gas.

“Traders are focusing on the fact that we’re probably going to see a record storage withdrawal,” said FCStong Latin America’s senior vice president of energy trading Tom Saal. “The market’s not ready to give up on winter yet.”

Thursday’s report is widely expected to show reserves dropping by more than 300 billion cubic feet in the week ending Jan. 10, a figure that would exceed the previous record decline of 285 billion cubic feet from Dec. 13.

Crude Oil Prices Continue to Plunge

News of this weekend’s deal with Iran that could return some of that country’s vast oil reserves to the open market pushed crude prices even lower on Monday, moving against natural gas’ big gains. West Texas Intermediate (WTI) crude was down almost 1 percent, below $92 a barrel, while Brent Crude was off over 0.25 percent to just under $107 a barrel.

"Up to 1 million barrels of Iranian oil per day could become available," said Commerzbank analysts. "Unless oil production was cut elsewhere, this would give rise to a considerable oversupply on the oil market, which would weigh on prices."

WTI reached a six-month low, continuing a decline of over 8 percent since it peaked at just over $100 a barrel in late December and pulling down ETFs connected to crude prices with it. The United States Oil Fund ($USO) was off almost 1.25 percent, the PowerShares DB Oil Fund ($DBO) fell just over 1 percent, and the United States 12-Month Oil Fund (USL) fell almost 0.75 percent.

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for UNG
Paul W. Mahon
21 Sep 14 13:00:04
RT @SeekingAlpha: An Unrest September For NG Traders: Analysis Of Current Working Gas Storage Data http://t.co/VDQtBUmPon $UNG
Seeking Alpha
21 Sep 14 12:21:35
An Unrest September For NG Traders: Analysis Of Current Working Gas Storage Data http://t.co/VDQtBUmPon $UNG
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21 Sep 14 10:51:38
DennyT: CNTF Filings and Disclosure $CNTF $NXPI $COH $UNG http://t.co/0KlUeuRphc
Investors Hangout
21 Sep 14 10:51:16
DennyT: CNTF Filings and Disclosure $CNTF $NXPI $COH $UNG http://t.co/zGBtUTJPEn
Investors Hangout
21 Sep 14 10:48:30
jim50: $UNG Current Price Date=Sept-19-2014 Open=21.03 http://t.co/Nek187mDZ1
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21 Sep 14 10:48:13
jim50: $UNG Current Price Date=Sept-19-2014 Open=21.03 http://t.co/GnEqoHYVNf
DennyT
21 Sep 14 10:38:16
CNTF Filings and Disclosure $CNTF $NXPI $COH $UNG $SIRI Buy?,50 Simple Moving Average,Current Price,Recent New http://t.co/pFHvBQTMSF
jim50
21 Sep 14 10:25:36
$UNG Current Price Date=Sept-19-2014 Open=21.03 High=21.1 Low=20.92 Close=20.95 Volume=6166000 http://t.co/lU4GSuM9mG
Alysia Sarkisian
21 Sep 14 10:17:33
RT @SeekingAlpha: Utilities Rise While Natural Gas Wobbles http://t.co/BPPvw3eY4t $UNG $NRG
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21 Sep 14 10:17:09
RT @SeekingAlpha: Utilities Rise While Natural Gas Wobbles http://t.co/BPPvw3eY4t $UNG $NRG
Smart Value
21 Sep 14 10:11:23
RT @SeekingAlpha: Utilities Rise While Natural Gas Wobbles http://t.co/BPPvw3eY4t $UNG $NRG
Seeking Alpha
21 Sep 14 10:11:04
Utilities Rise While Natural Gas Wobbles http://t.co/BPPvw3eY4t $UNG $NRG
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jim50
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leahanne
21 Sep 14 08:23:46
$X United States Steel Corp (X) 45.19 -0.81 (-1.76%) $BHP $MLHC $UNG http://t.co/1SKvNJqqO9
Investors Hangout
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DennyT: SWKS Research Reports $SWKS $UNG $PBR $CDE $RGI http://t.co/TshC19Xsfl
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chartguy89
21 Sep 14 07:27:39
GS Stock Chart $GS $GG $TLT $UNG http://t.co/8QnNTkP640 http://t.co/MRvaBpHSAE
OTPicks.com
20 Sep 14 22:45:54
http://t.co/hjgLwIcNgz Stock_Tracker: $UNG Recent News Cutting losses on natural gas: Sto http://t.co/RHh6nPAw4g http://t.co/hjgLwIcNgz
OTPicks.com
20 Sep 14 22:45:52
http://t.co/QkCFZ8H3V8 Stock_Tracker: $UNG Recent News Cutting losses on natural gas: Sto http://t.co/kX3sYlTkE0 http://t.co/QkCFZ8H3V8
OTPicks.com
20 Sep 14 18:07:24
http://t.co/hjgLwIcNgz danrocks: $ZTS keeping this on watch $XLI $T $HL $PBR $UNG: danrocks http://t.co/Kk9qcfK5Sh http://t.co/hjgLwIcNgz
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20 Sep 14 18:03:18
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20 Sep 14 12:39:30
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20 Sep 14 09:02:06
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20 Sep 14 08:40:48
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20 Sep 14 08:25:35
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TA Plot
19 Sep 14 19:14:23
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By  +Follow January 13, 2014 8:46AM
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