Natural gas prices surged 8 percent Thursday as the government reported supplies dropped for the first time in nine months, yet the price of crude fell for the seventh straight day.
A barrel of crude dipped below $70 for the first time in two months.
Crude and natural gas prices move for very different reasons, but when there is a sell-off in oil markets, a lot of that money can flow into natural gas contracts.
Trading volumes in natural gas this week have nearly doubled.
A lot of money is coming of crude markets because the dollar is finally showing some signs of life after months in the doldrums.
Crude is bought in U.S. currency and for most of this year the dollar has been falling, meaning that investors holding stronger currencies can get more crude for less money.
Since the beginning of the year, the price of a barrel has nearly doubled.
That began to change at the start of this month.
Crude was trading above $78 per barrel on Dec. 1 when the dollar bounced off 15-month lows. In that same span, crude fell by more than $8 per barrel, while the price for natural gas jumped nearly 12 percent.
Also helping boost the price of natural gas are winter storms spreading from the Midwest to the East.
Temperatures dropped to 10 degrees from Des Moines to Chicago, and frigid winds have forced chill values as low as negative 25 in parts of Wisconsin, Iowa and Illinois, according to the National Weather Service.
"The weather is a significant driver here," analyst and trader Stephen Schork said. "It's about as bullish as it can get this year."
That's unlikely to mean higher heating costs where natural gas is used.
Utilities locked in delivery contracts months ago when natural gas was trading at seven-year lows and that is passed on to homeowners. A number of utilities have already sent out notifications that rates are coming down.
Heating oil is another story because it generally follows the price of crude. The price for heating oil has jumped nearly 40 percent since February, though like crude, those prices began to fall on Dec. 1.
Natural gas prices are being kept in check, at least so far, because of the unprecedented volume being held in storage.
It has been a mild winter to date and the worst economic downturn in generations has destroyed demand from big energy users like manufacturers.
Storage of natural gas is above listed capacity in the West, and at or near capacity everywhere else.
The Energy Information Administration reported that levels dropped by 64 billion cubic feet last week, the first reported draw since early March.
Natural gas for January delivery jumped 40 cents to settle at $5.298 per 1,000 cubic feet on the New York Mercantile Exchange.
Benchmark crude for January delivery gave up 13 cents to settle at $70.54 a barrel on the Nymex. Prices dropped as low as $69.81 a barrel earlier in the day.
At the pump, retail gas prices dropped slightly overnight to a national average of $2.629 a gallon, according to auto club AAA, Wright Express and Oil Price Information Service. A gallon of regular unleaded is 2.9 cents cheaper than last month but 94.6 cents more expensive than the same time last year.
In other Nymex trading in January contracts, heating oil lost less than a penny to settle at $1.9029 a gallon while gasoline lost 2.22 cents to settle at $1.8351 a gallon.
In London, Brent crude for January delivery fell 53 cents to settle at $71.86 on the ICE Futures exchange.
Associated Press writers Pablo Gorondi in Budapest, Hungary and Alex Kennedy in Singapore contributed to this report.