Natural gas prices are retreating from $ 4.80 level after last week's rally. A pullback is also taking place in the case of European gas prices, which is related to the fact that the supply in both regions, at least for the moment, is not threatened. The decline of US inventories was significant, over 200 billion cubic feet, which was slightly more than expected. More importantly, however, gas inventories have recently moved above the 5-year average.
Is this the end of the bulls rally? Theoretically yes, because usually the biggest increases take place just before the start of the winter season, i.e. in November. Of course, it is also worth remembering that last year's winter attack in the US and in Europe took place at the turn of January in February, so it is worth observing the weather forecasts.
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NATGAS prices took a hit in recent days. Seasonality indicates a longer period of consolidation. Source: xStation5
US gas stockpiles have recently climbed slightly above the 5-year average. Last year, during this period, inventories level significantly exceeded the 5-year average, which still provides some hope for the bulls. Source: EIA
Downward movement can also be observed in Europe. Compared to the December highs, the price fell by more than 50%. It is worth noting that the current prices are over 3 times higher than in the corresponding period a year ago. Source: Bloomberg
