Gas has biggest rally since Oct. with arctic freeze
Dec. 28, 2017 at 11:30 p.m.
U.S. natural gas staged the biggest rally in two months as a frigid forecast signaled demand for the power-plant fuel may surge to new highs through the start of 2018.
The eastern half of the country is locked in a deep freeze with the potential to generate the highest weather-driven gas demand for the last week of December and the first few days of January in data going back to the 1950s, according to MDA Weather Services. Chicago's low on New Year's Day will be minus 1 degree Fahrenheit, 11 below normal, according to AccuWeather.
The cold wave that started this week has catapulted U.S. gas consumption to an all-time high for this time of year while simultaneously curtailing record production from shale deposits that had helped cap prices. The one-two punch jolted gas futures higher Thursday after the latest computer models showed the cold persisting for the next two weeks and deepening a supply deficit.
"It's a crazy day," said John Borruso, director of natural gas trading at Con Edison Energy in Valhalla, New York. "They finally realize it's winter and that it gets cold in winter."
Gas futures for February delivery rose 6.7 percent to $2.914 per million British thermal units on the New York Mercantile Exchange, the biggest percentage gain since Oct. 30.