US Natural Gas Supplies Constrained As Extreme Cold Freezes Wells And Pipes

U.S. natural gas supplies were constrained after extreme weather caused wells and pipes to freeze, although some recovery seemed to be underway.

What Happened: Output declined as low as 84.2 billion cubic feet on Dec. 24 and barely witnessed any improvement on Sunday, with utilities from Texas to New York City calling on customers to conserve power to protect supply, reported Bloomberg.

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Temperatures in Midland, Texas, which is a key producing region, were seen rising as high as 59 F (15 C), while the Northeast should continue to see below-freezing conditions at least until Tuesday, the report said citing the Weather Channel.

Strong winds and subzero temperatures created chaos across the U.S. leaving millions without power as the weather system intensified into a bomb cyclone on Friday. The storm knocked out power to several hundred thousand homes and businesses and canceled thousands of flights.

About 60% of the U.S. had been under a winter weather advisory or warning from the system, stretching from the Great Lakes near Canada to the Rio Grande on the Mexico border.

rice Action: The ProShares Ultra Bloomberg Natural Gas (NYSE: BOIL) closed 2.27% lower on Friday while the United States Natural Gas Fund, LP (NYSE: UNG) closed 0.63% higher.

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