Natural gas prices remain under pressure in the short term

Opening the morning trading session on May 28, 2024, today's gas price in the world market decreased by 0.36%, at 2.78 USD/mmBTU for natural gas contracts for delivery in June 2024.

Forecasts for an exceptionally active Atlantic hurricane season this year pose additional risks to the U.S. oil and natural gas industry. Meteorologists are predicting 20 to 25 storms, with the potential for more than 30 this year. These storms could disrupt crude oil production and refining, particularly in the Gulf of Mexico and along the Texas and Louisiana Gulf Coasts, which account for nearly half of U.S. refining capacity.

Gas price today, May 28, 2024: Natural gas prices remain under pressure in the short term. Illustration photo

While hurricanes can reduce natural gas production in the Gulf of Mexico, the impact on overall U.S. supply is expected to be minimal given the region’s declining share of production. However, LNG exports can face disruptions, as seen with Hurricane Laura in 2020. The U.S. has a large amount of LNG export capacity located on the Gulf Coast, making the country vulnerable to weather-related disruptions.

With current selling pressure, cool weather forecasts and potential delays in LNG project completion, natural gas prices are expected to remain under pressure in the short term. The upcoming hurricane season adds to the bearish outlook, with potential production and export disruptions weighing on sentiment. Traders should remain cautious and closely monitor weather developments and project updates.

U.S. natural gas futures are expected to fall after the 200-day moving average of $2.761 in the previous session triggered a sell-off. The indicator represents a long-term trend and is now a new resistance level.

In the domestic market, domestic retail gas prices in May continued to decrease since May 1. Accordingly, for 12kg gas cylinders, gas companies will reduce prices by more than VND7,000/cylinder. Thus, domestic retail gas prices have decreased for the second consecutive month since the beginning of the year.

Specifically, the retail price of Petrolimex gas cylinders (including VAT) in May 2024 in the Hanoi market is 448,800 VND/12 kg household cylinder; 1,795,200 VND/48 kg industrial cylinder, respectively decreasing by 7,300 VND/12 kg cylinder and 29,100 VND/48 kg cylinder (including VAT).

Similarly, the gas prices of City Petro, Vina Pacific Petro, and Vimexco of Ho Chi Minh City Energy Import-Export Joint Stock Company also decreased by VND5,000/12kg cylinder and VND21,000/50kg cylinder. Accordingly, the retail gas price to consumers does not exceed VND471,000/12kg cylinder and VND1,960,500/50kg cylinder.

PetroVietNam Gas price of Vietnam LPG Gas Trading Joint Stock Company, Southern branch, decreased by 5,000 VND/12kg cylinder and 18,750 VND/45kg cylinder; Saigon Petro gas price of Ho Chi Minh City Petroleum One Member Co., Ltd. (Saigon Petro) decreased by 4,500 VND/12kg cylinder, the maximum retail gas price to consumers does not exceed 434,000 VND/12kg cylinder.

The reason for this price reduction is that the average world gas price contract in May was at 582.5 USD/ton, down 35 USD/ton compared to April, and also due to fluctuations in the USD exchange rate, so domestic prices were adjusted accordingly.

Thus, since the beginning of the year, domestic gas prices have increased 3 times (January, February, March) and decreased 2 times (April, May).

Information is for reference only!

Source: https://congthuong.vn/gia-gas-hom-nay-ngay-2852024-gia-khi-dot-tu-nhien-van-chiu-ap-luc-trong-ngan-han-322660.html