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US natural gas market has probably normalized

10 May 2014 by Jim Fickett.

Demand for US natural gas has been high enough for the last two years that gas in storage, measured in 12-month-average months-of-supply, has dropped pretty steadily:

The statistics (from the Energy Information Administration of the Department of Energy) are slow to come out, so the graph above only goes through February. However weekly spot prices have continued a noisy but fairly clear two-year uptrend through April:

Recent reports from exploration and development companies have been somewhat more positive, and stock prices are up. This is partly because most companies have been concentrating on liquids-rich plays. However it is also the case that the gas price is finally at a level to cover expenses, and many companies are now reporting an operating profit from gas.