(Greg Molnar, June 18) Henry Hub collapsed to a 21-years low with prices falling to $1.38/mmbtu this week, their lowest level since December 1998.
Back then, Henry collapsed close to $1/mmbtu (and was even trading below within-day) mainly due to domestic market conditions: ample supply, high stocks and an unseasonably mild weather.
This time this is primarily driven by global gas market conditions.
Whilst there was no big moves in terms of domestic supply or demand, US LNG feedgas flows have fallen by almost threefold since end of March, from ~270 mmcm/d close to 100 mmcm/d this week, as the HH-TTF/JKM spreads collapsed through April and May.
Where will Henry move this summer? Could it go lower? Could US LNG exports rebound now that the spread with TTF and JKM is widening again?
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