US natural gas prices surge 9% on pipeline leak, then fall 5.5% as disruption seen brief
A leak on TC Energy's Columbia Gas Transmission pipeline in West Virginia triggered a force majeure, reducing transport capacity by 1.8 billion cubic feet per day and affecting up to 1.5% of Lower 48 state supply. This caused US natural gas futures to surge 9% on Thursday, the highest close since June 25, before falling 5.5% on Friday to $3.115/MMBtu as analysts at Ritterbusch & Associates assessed the disruption would be short-lived. The initial spike was amplified by short-covering amid high speculative short positions. Separately, European gas prices were set to fall over 5% for the week due to mild weather and diplomatic efforts, though EU storage at about 70% capacity and reduced Norwegian flows leave the market vulnerable.
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US natural gas prices surge 9% on pipeline leak then fall as supply disruption seen brief
US natural gas futures experienced sharp volatility after a pipeline leak in West Virginia. TC Energy's Columbia Gas Transmission pipeline triggered force majeure, reducing transport capacity by 1.8 billion cubic feet per day and affecting up to 1.5% of Lower 48 state supply. This caused a 9% price surge on Thursday, the highest close since June 25. However, prices fell 5.5% on Friday to $3.115/MMBtu as Ritterbusch & Associates assessed the disruption would likely be short-lived. The firm also noted that the initial spike was amplified by short-covering amid previously high speculative short positions, as traders had grown complacent about supply risks due to ample storage buffers. Meanwhile, European gas prices were set to fall over 5% for the week, pressured by diplomatic efforts to end Middle East conflict and mild seasonal weather. However, EU gas storage is only about 70% full, and ANZ analysts warned that LNG's inflexible transport and security vulnerabilities leave European supply exposed to any new disruption, especially with reduced Norwegian pipeline flows due to maintenance.
Read sourceUS natural gas prices swing sharply after pipeline leak triggers 9% surge then retreat
US natural gas futures experienced sharp volatility after a pipeline leak in West Virginia disrupted supply. TC Energy's Columbia Gas Transmission pipeline leak triggered force majeure, reducing daily transport capacity by 1.8 billion cubic feet and affecting up to 1.5% of Lower 48 state gas supply. This caused a 9% price surge on Thursday, the highest close since June 25. However, prices fell 5.5% on Friday to $3.115/MMBtu as markets anticipated the disruption would be brief. Ritterbusch & Associates noted the price spike may have been amplified by short-covering from speculative positions built during a period of comfortable inventory buffers. Separately, European gas prices are expected to fall over 5% this week due to mild weather and diplomatic efforts to end Middle East conflict, though EU storage at only 70% capacity and reduced Norwegian pipeline flows leave the market vulnerable to supply shocks. ANZ analysts highlighted LNG's lower transport flexibility compared to oil, increasing exposure to geopolitical risks.
Read sourceUS Natural Gas Prices Swing Wildly on Pipeline Leak, Then Fall as Supply Disruption Seen Short
US natural gas futures experienced a sharp reversal on Friday, giving back much of the previous day's gains. On Thursday, prices surged 9% after a pipeline leak in West Virginia triggered a force majeure, reducing transport capacity by 1.8 billion cubic feet per day and affecting up to 1.5% of supply in the lower 48 states. The disruption, involving TC Energy's Columbia Gas Transmission and Mountaineer Xpress pipelines, compounded existing supply tightness as Appalachian producers had already begun cutting output ahead of the autumn demand lull. However, analysts at Ritterbusch & Associates stated the outage is likely short-lived, and the exaggerated price spike may have been amplified by short-covering from speculative traders who had built large bearish positions due to ample summer storage. By Friday, the October NYMEX contract fell 5.5% to $3.115/MMBtu. Separately, European gas prices are set to fall over 5% this week amid mild weather and diplomatic hopes for an end to the Middle East conflict, though EU storage at only about 70% capacity and reduced Norwegian pipeline flows leave the market sensitive to any new supply shocks.
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US Natural Gas Prices Swing Wildly After Pipeline Leak Triggers 9% Surge Then Retreat
U.S. natural gas futures experienced a sharp reversal on Friday, giving back some of the previous day's gains. On Thursday, prices surged 9% after TC Energy's Columbia Gas Transmission pipeline in West Virginia leaked, triggering a force majeure and reducing transport capacity by 1.8 billion cubic feet per day, affecting up to 1.5% of supply in the lower 48 states. The spike was amplified by short-covering, as traders had built up bearish positions due to ample summer storage. However, analysts at Ritterbusch & Associates expect the disruption to be short-lived, leading to a 5.5% drop on Friday to $3.115 per million British thermal units. Meanwhile, European gas prices are set to fall over 5% this week on mild weather and diplomatic hopes for an end to the Middle East conflict, though EU storage at only about 70% capacity and reduced Norwegian pipeline flows keep the market sensitive to supply shocks. Analysts at ANZ note that LNG is less flexible than oil and more exposed to security risks, maintaining a risk premium.
Read sourceUS Natural Gas Prices Swing Wildly After Pipeline Leak Sparks 9% Surge Then Retreat
US natural gas futures experienced a sharp reversal on Friday, retreating from a 9% surge the previous day triggered by a pipeline leak in West Virginia. TC Energy's Columbia Gas Transmission pipeline suffered a leak, prompting a force majeure declaration and reducing transport capacity by 1.8 billion cubic feet per day, affecting up to 1.5% of supply in the lower 48 states. This drove the October NYMEX contract to its highest close since June 25. However, prices fell 5.5% to $3.115/MMBtu on Friday as analysts at Ritterbusch & Associates predicted the disruption would be short-lived. The firm also noted that the initial price spike was amplified by short-covering after traders had built large speculative short positions due to ample summer storage. Meanwhile, European gas prices were set to fall over 5% for the week, pressured by mild weather and diplomatic hopes for an end to the Middle East conflict. However, EU storage at only about 70% capacity, reduced Norwegian pipeline flows due to maintenance, and the inflexibility of LNG shipping leave the market highly sensitive to any new supply disruptions, according to ANZ analysts.