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The benchmark U.S. natural gas prices tumbled again on Thursday to the lowest level in nearly a year on warmer-than-normal weather.
As of 9:01 a.m. ET, the benchmark price at the Henry Hub had plunged by more than 7% at $3.888 per million British thermal units (MMBtu), for a 7.14% drop on the day. Prices are now down by 57% compared to the highs from this summer.
U.S. natural gas prices rebounded by 4.6% on Wednesday, following an 11% plunge on Tuesday, due to warmer weather.
In the United States, after the Winter Storm Elliott on Christmas Eve and Christmas Day, weather forecasts point to mild temperatures and very low gas consumption.
In the week of January 5 to January 11, U.S. national demand for natural gas will be low to very low, according to NatGasWeather.com.
“Warmer than normal conditions will rule the southern and eastern US most of the next 7-days w/highs of 30s to 50s across the Great Lakes, Ohio Valley, and Northeast and very nice upper 50s to 70s over the southern US and up the Mid-Atlantic Coast for very light national demand,” NatGasWeather.com said.
There will be a minor bump in demand late this week and again late next week as mild weather systems track into the East. The West Coast will be wet and windy with heavy valley rains and mountain snows as a storm tracks inland the next several days with highs in the 40s to 60s, the forecast suggests.
Natural gas prices in Europe have also slumped due to a mild start to the year. The benchmark European price at the TTF hub dropped on the first trading day of the year to its lowest level since February 21, 2022, days before the Russian invasion of Ukraine, which upended energy markets and sent gas prices skyrocketing.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.