Natural gas prices on the New York Mercantile Exchange fell on October 3, closing at $2.893 per million British thermal units, down 1.06%. This decline is attributed to cooler weather forecasts in the U.S., particularly in the Northeast, expected to reduce demand from electricity providers for air-conditioning.
Despite the drop in U.S. natural gas prices, European prices surged to a 3.5-year high due to concerns over prolonged closure of the Strait of Hormuz amidst escalating U.S.-Iran tensions, which affects about 10% of Europe’s gas supply. U.S. dry gas production was recorded at 114.0 billion cubic feet per day (bcf/day), a 5.5% increase year-over-year, while demand reached 79.7 bcf/day, up 14.7% year-over-year.
Additionally, estimates from the U.S. Energy Information Administration indicate that natural gas storage levels may reach 3,985 bcf by the end of October, the highest in a decade. The report also projected an increase in U.S. natural gas production to 116.0 bcf/day by 2027.
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