Collapse of a Key Natural Gas Trade Points to a Massive US Supply Glut
An outage at a major Texas plant has dented exports of the fuel.
A worker checks valves among transfer pipes at the Freeport LNG facility in Quintana, Texas.
Photographer: Craig Hartley/BloombergThis article is for subscribers only.
Natural gas traders are giving up on the idea that a sweltering summer will boost demand for the power-plant fuel and curb a massive US supply glut.
The spread between October and January gas futures — essentially a bet on how tight stockpiles will be heading into the northern hemisphere’s winter — has collapsed in recent weeks. By the end of October, inventories stored underground in depleted reservoirs, aquifers and salt caverns are expected to reach the highest since at least 2016, according to a government forecast.