Natural gas prices at the Waha hub in the Permian basin in Texas slumped to a negative value of -$2.00 per million British thermal units
MMBtu this week as the recent rise in oil prices prompts producers to bring drilled but uncompleted wells online. As the U.S. benchmark oil price, West Texas Intermediate, hit $85 per barrel—the highest level in nearly six months, Texas producers keep pumping crude, but their wells also produce gas, which basically has nowhere to go. While producers are chasing higher realizations for the crude they pump, they are depressing further an already depressed U.S.
“They’re bringing these drilled, uncompleted wells online because the price of oil is higher,” Dennis Kissler, senior vice president for trading at BOK Financial Securities, told Bloomberg. “It’s flooding the market with gas, and you’ve got no demand,” Kissler added. Yet, signs have started to emerge that the natural gas glut may have started to hold back drilling in parts of the Permian basin. U.S.
Natural Gas Gas Prices Waha Permian
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