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An oil well pump jack operated by Chevron is seen in San Ardo, Calif., on April 27, 2021.

An oil well pump jack operated by Chevron is seen in San Ardo, Calif., on April 27, 2021. (David Paul Morris/Bloomberg)

U.S. natural gas prices surged to the highest intraday level in over 13 years as robust demand tests drillers' ability to expand supplies.

Futures rose as high as $7.558 per million British thermal units, topping January's short squeeze-fueled rally and roughly double levels from the start of the year.

A global fuel crunch is rippling across markets as suppliers struggle to meet a post-pandemic surge in consumption, further exacerbated by the war in Ukraine. While U.S. natural gas prices have remained well below rates in Europe and Asia for the past year thanks to a bounty of shale fields, that discount has been shrinking.

Backup inventories held in underground caverns and aquifers are below normal for this time of year and production is holding flat. Meanwhile, the U.S. is exporting every molecule of liquefied natural gas possible to help Europe reduce its reliance on Russian energy supplies.

Below-normal temperatures are forecast across parts of the northern U.S. from April 25 to May 1, according to the National Oceanic and Atmospheric Administration. That could increase demand for the heating and power-plant fuel, diverting supply that normally goes to storage during this time of year. A shortage of coal in the U.S. has also helped fuel the gas rally, limiting power generators' ability to switch fuels.

Inventories grew by 15 billion cubic feet in the week ended April 8, less then half the average gain for the period over the past five years, the Energy Information Administration said last week. Stockpiles remain almost 18% below usual levels.

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