Although some basis blowouts (temporary pipeline capacity cost increases) have occurred in the northeast due to temperature extremes in January (gas over $16 per MMBtu at the New York city gate on January 24), natural gas commodity prices have remained remarkably stable, even with the strongest underground storage withdrawal of the season for the week ending January 14.
Basis increases tend to be indicators of pipeline capacity constraints during periods of peak demand – not a precursor of supply shortages. To the contrary, working gas inventories remain solid compared to recent history and the combination of imported pipeline gas, domestic production, minimal LNG volumes, and storage have reliably met consumer requirements.
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