US natgas futures rises as consumers crank up air conditioners
- That increase, however, came after prices fell over 4% to a three-week low on Monday on forecasts for less hot weather next week.
- Front-month gas futures rose 3.4 cents, or 2.1%, to settle at $1.675 per million British thermal units.
US natural gas futures rose 2% on Tuesday as power generators burned record amounts of gas this week to keep air conditioners humming during the hottest part of a heat wave blanketing much of the country.
That increase, however, came after prices fell over 4% to a three-week low on Monday on forecasts for less hot weather next week.
Front-month gas futures rose 3.4 cents, or 2.1%, to settle at $1.675 per million British thermal units. On Monday, the contract closed at its lowest since June 26.
As the weather turns hotter, data provider Refinitiv forecast US demand, including exports, will rise from 92.3 billion cubic feet per day (bcfd) this week to 93.6 bcfd next week. The power industry consumed more than half of that gas, gobbling up a one-day record of 47.5 bcfd on Monday.
Pipeline gas flowing to US LNG export plants averaged 3.4 bcfd (35% utilization) so far in July, down from a 20-month low of 4.1 bcfd in June and a record 8.7 bcfd in February. Utilization was about 90% in 2019.
US pipeline exports, meanwhile, rose as consumers in neighboring countries cranked up their air conditioners.
Refinitiv said pipeline exports to Canada averaged 2.4 bcfd so far in July, up from 2.3 bcfd in June, but still below the all-time monthly high of 3.5 bcfd in December. Pipeline exports to Mexico averaged 5.58 bcfd so far this month, up from 5.44 bcfd in June and on track to top the record 5.55 bcfd in March.
Refinitiv said production in the Lower 48 US states averaged 88.3 bcfd so far in July, up from a 20-month low of 87.0 bcfd in June but still well below the all-time monthly high of 95.4 bcfd in November.
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