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U.S. natural gas futures jumped 22% for October after surging Tuesday, as changing weather forecasts continue to be the biggest spark behind gains.
Front-month Nymex natural gas (NG1:COM) for December delivery settled +6.7% to end the month at $3.575/MMBtu, its highest settlement value since January 17 and strongest monthly showing since August 2022; Tuesday’s move wrapped up a 22.1% gain for the month, although prices are still down 20.1% YTD.
ETFs: (NYSEARCA:UNG), (UGAZF), (BOIL), (KOLD), (UNL), (FCG)
Gas-focused stocks scored broad gains in Tuesday’s trading, including Range Resources (RRC) +3.8%, Antero Resources (AR) +3.1%, EQT (EQT) +2.9%, Southwestern Energy (SWN) +1%, Coterra Energy (CTRA) +0.6%.
The bottom for natural gas prices is “in the rearview mirror,” according to Raymond James analyst Pavel Molchanov. “It is very hard to imagine gas prices during the winter months coming back down towards their mid-2023 lows.”
Some overnight weather forecasts were revised colder, leading to Tuesday’s price rally, Tradition Energy research director Gary Cunningham told MarketWatch.
The biggest change among some forecasts was a reduction in the above-normal temperatures expected to hit the Rocky Mountains in the coming weeks, but also there were cooler shifts for the natural gas-sensitive northeast for the 11-15 day outlook, according to Cunningham.