(Adds market background)
NEW YORK, April 7 U.S. natural gas speculators
this week boosted net longs for a fifth week in a row, betting
prices will keep rising on the possibility there will be less
gas than usual in storage at the start of next winter due to low
production and rising exports.
Speculators in four major NYMEX and ICE markets added to
their bullish bets by 25,776 contracts to 368,859 in the week to
April 4, the U.S. Commodity Futures Trading Commission said on
That is the highest level since May 2014, data showed, and
compares with a five-year (2012-16) average speculative net long
position of around 127,300. The biggest net long position was
456,475 in April 2013, while the biggest net short position was
166,165 in November 2015, according to Reuters data.
Gas futures on the New York Mercantile Exchange
averaged $3.21 per million British thermal units during the five
trading days ended April 4 versus $3.06 during the five trading
days ended March 28.
After one of the warmest winters on record, inventories
ended the November-March withdrawal season at almost 2.1
trillion cubic feet. That compares with a record high 2.5 tcf on
March 31 last year and a five-year (2012-2016) average of 1.8
Over the summer, however, analysts forecast utilities would
add just 1.7 tcf of gas during the April-October injection
season, which would be much less than the 2.1 tcf seen on
average over the past five years.
If correct, that would leave stockpiles at the end of
October just 3.7 tcf versus a record high of 4.0 tcf on Oct. 31
last year and a five-year average (2012-2016) of 3.9 tcf.
The U.S. Energy Information Administration (EIA) in March
forecast pipeline and liquefied natural gas exports would rise
from an average of 6.3 billion cubic feet per day (bcfd) in 2016
to 8.1 bcfd in 2017 and 9.5 bcfd in 2018. Some analysts expect
exports to rise even further this year and next.
That puts the United States on track to transition from a
net importer of gas to a net exporter of the fuel on an annual
basis in 2017 or 2018. The U.S. was last a net exporter of gas
on an annual basis in 1957.
U.S. gas production, meanwhile, has remained at its lowest
since 2014 over the past month or so, averaging just 70.1 bcfd
during the past 30 days.
(Reporting by Scott DiSavino and Catherine Ngai; Editing by
Chizu Nomiyama and Marguerita Choy)