According to a KPMG LLP Global Energy Institute survey of U.S. energy executives natural gas will keep trading below $4 per million British thermal units for the rest of the year. Gas for delivery in June dropped yesterday to $3.932, which is a 12% decrease from the 2013 high on May 1 at $4.444. News about the increase in the U.S. gas reserves by 99 billion cubic feet last week applied downward pressure on the energy source.
According to the EIA, U.S. gas inventories rose by 99 billion cubic feet to 1.964 trillion in the week ended May 10, above the five-year average gain of 83 billion for the period. Analysts surveyed by Bloomberg expected an increase of 95 billion.
The supply deficit narrowed for a second week, dropping to 4.1% from 5%, the Energy Information Administration said. The deficit versus year-earlier levels narrowed down to 26.1% from 28.3%.
Gordy Elliott, a risk-management specialist at INTL FC Stone LLC in St. Louis Park, Minnesota, said for Bloomberg: “We have no extreme temperatures in the forecast so we are not going to need a lot of power generation. We should have some bigger injections in the next three or four weeks and we should continue to see pressure in this market.”
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