It might be time for US natural gas producers to turn off the pumps.
Henry Hub is trading at $1.74 for March delivery, which is the lowest sine the early months of the pandemic. Excluding covid, you have to go back to 2016 when it only briefly traded below these levels.
Worse yet, sub-$2 prices extend through May on the strip, only rising to $2.34 next September.
No one is making money at those prices producing natural gas yet they continue to pump, far exceeding last year’s supply.
It’s getting ugly at the moment and the latest weather forecasts are balmy so there is no white knight coming.
I think we might need to see sub-$1 natural gas prices to finally get some discipline in the natty market.