NEW YORK – Natural gas prices rose toward fresh eight-month highs on Wednesday due to hurricane-caused supply disruptions and robust demand from extended-summer heat in the United States.
Futures for November delivery were 0.8 percent higher at $3.293 a million British thermal units on the New York Mercantile Exchange. Two days ago, on Monday, prices closed at $3.2670, the highest settle value since Jan. 29.
“The market has been rolling,” said Dan Flynn at Price Futures in Chicago. “Hot weather and Hurricane Michael have the market higher again as rigs and refineries will need generators working to keep flood damage to a minimum.”
Hurricane Michael quickly has moved north along the eastern side of the Gulf of Mexico over the past two days, forcing oil and gas production fields to reduce activity.
The government’s Bureau of Safety and Environmental Enforcement said Tuesday that 28 percent of natural gas production in the gulf waters has been halted because of the storm, as workers evacuated production platforms for safety.
Investors next will watch for Thursday’s weekly report on US natural gas storage. Some analysts are expecting a lower-than-normal increase in storage, but even an on-par increase would mean gas storage is still at a huge deficit heading toward the high-demand winter season.