(Bloomberg) by Jonathan Crawford and Naureen Malik – Natural gas advanced to an 11-week high on speculation that demand for the power-plant fuel will rise. Plants will burn 13 percent more gas this year to average a record 25.21 billion cubic feet a day, according to data from an Energy Information Administration report Tuesday. The government raised its estimate from 24.9 billion in last month’s outlook. “At these levels it absolutely makes sense that consumption will be strong this summer,” Stephen Schork, president of Schork Group Inc., a consulting firm in Villanova, Pennsylvania, said by phone Wednesday. “Basically, there’s no reason to burn coal at these prices.” Natural gas for June delivery gained 3.8 cents, or 1.3 percent, to settle at $2.935 per million British thermal units on the New York Mercantile Exchange, the highest since Feb. 20. Volume for all futures traded was 28 percent above the 100-day average at 2:44 p.m. Power prices rebounded 18 percent from the 34-month low of $2.49 reached April 27 as money managers exited some of their bearish bets, Tim Evans, an energy analyst at Citi Futures in New York, said in a note to clients. “While the storage data looks bearish, the market … continue reading
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Source: CTRM Center