This week started with weaker futures for natural gas. The weaker gas prices took a toll on shares of coal companies such as Patriot Coal (PCX), Alpha Natural (ANR), Arch Coal (ACI), Quicksilver (KWK) and Peabody (BTU), on Monday, with a down of 5% or more.
According to the U.S. Energy Information Administration reports, the level of stored natural gas went down by 82 billion ft3 in the week that ended with Feb 24. The report also revealed that the 2.513 trillion cubic feet of inventories last week are at the highest level ever for this time of year and 45% above the five-year average for the week.
The natural-gas-drilling rigs deployed in the U.S. decreased by 19 during the latest week, coming down to 691. But, as oil drilling continues to go high with a great ascent, the lower rig count of gas drilling rigs don’t hamper the gas output. The number of oil rigs currently working in the US has increased by 61% than those a year ago. The traders said that the oil wells produce about one-third of U.S. gas along with producing oil primarily.
Oil and Gas analysts point out that the warmer-than-normal temperatures will keep gas withdrawals from storage below normal levels. This indicates that stocks will go higher near the end of winter.