PXD - Natural gas crossed $9.00 while nobody was looking
Natural gas (NG1:COM) for June delivery brushed up against $9.00 Friday morning; however, as equities collapsed Thursday, natural gas for December delivery reached $9.14. A perfect storm that lifted prices to $8.00 earlier in the week, shows no sign of abating. Demand for gas is not particularly price sensitive, and a historic rally in coal price means there's little flexibility to substitute thermal coal into the power stack, suggesting that US natural gas supply growth will be required to lower prices, and US supply growth has not responded to higher prices: This week, several E&Ps reported, many lifted capital spending, including Conoco (COP), Laredo (LPI) and Marathon (MRO); however, none of the capex increases led to increased production guidance. Other reports this week from BP (BP), Shell (SHEL), and Coterra (CTRA), flagged falling Q2 oil and gas production. Pioneer (PXD) reported Wednesday, with CEO Sheffield saying estimates for 2022 US
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Natural gas crossed $9.00 while nobody was looking