Natural Gas Futures Surge as it Recovers from a Downfall

On Tuesday, the natural gas futures increased as it recovers from last week’s lowest level in almost two years.

Natural Gas went up as it recovers from last week's downfall 

Front-month U.S. natural gas futures went up 2.8 percent, or 7.0 cents, to $2.628 per million British thermal units.

Earlier in the session, it achieved its best level since February 9 at $2.662, above its last 21-month low of $2.530.

The U.S. gas futures, on the other hand, did not settle yesterday due to the holiday, which is the Presidents' Day.

Last week, the commodity saw a weekly decreased of 1 percent, its third-in-a-row loss.

The prices of natural gas went down nearly 30 percent late last month, amid assumption that the warm season will bring heat around United States and cut into demand for the fuel.

Spring is usually seen as the weakest demand for natural gas in the U.S., as the lack of extreme temperatures curbs demand for heating and air conditioning. While the warmer season is the peak demand for natural gas.

However, market participants are looking ahead to this week’s storage data which is due on Thursday. The storage data is expected to show a draw in a range between 112 and 128 billion cubic feet in the week ended on February 16.

According to the U.S. Energy Information Administration, the total natural gas that’s in storage as of now stands at 1.884 trillion cubic feet.

Israel to Export Natural Gas in Egypt

In other news, Delek Drilling, an Israeli company, has said that it will supply Egypt with $15bn worth of natural gas, which is the largest export agreement to date for the natural gas industry of Israel.

According to a statement, Dolphinus, an Egyptian company, will buy a 64 billion cubic meters of natural gas from Delek Drilling and Noble, its U.S. partner, during a 10-year period.

Benjamin Netanyahu, Prime Minister of Israel, has welcomed the “historic” deal.

“This will bring billions into the country's coffers,” the Prime Minister stated.

He also stated that the agreement would “strengthen [Israel's] security, our economy, and also strengthen our regional relationships.”

Meanwhile, the CEO of Delek Drilling, Yossi Abu, said that the deal between the two companies would “establish Egypt's status as a regional energy centre.”

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