After the FOMC meeting on Wednesday, natural gas prices dropped by 1%, but that was not the only reason for the decline.

More gas storage data has come in, showing excess stores that are not likely to be drained anytime soon. Major suppliers have plenty of gas to last them for months, and many of their buyers are not interested in buying much more at the moment. With low demand and plenty of gas on standby, the prices were bound to drop again.

Now, the natural gas price is down below $1.90 once more, dropping as low as $1.685 at the lowest point today before spiking up to $1.83.

FOMC Decision Affects Gas Price

On Wednesday, the Federal Reserve chose not to enact price cuts nor even to announce when some might be coming. That left the rates where they have been, between 5.25% and 5.50%. The major reason for the decision was inflation, which is still high at 3.2% last report and not nearly close enough to the 2% benchmark the Federal Reserve is waiting to see before they breathe a sigh of relief.

We could see lower borrowing costs in the near future as national costs are approaching a healthy level, according to the Fed statement. That could allow the Lower 48 gas industry to expand soon.

As natural gas prices continue to fall, crude oil rates are also down. Crude Oil Continuous Contract fell 0.33%, with Brent Crude Oil dropping 0.90% over the last day. We expect the prices to continue to stay low for the next couple of days and to have trouble getting much higher over the next few months. As supply issues and low demand persist, there is not much reason to expect a major change in gas and oil prices until closer to the fall season.