NEW YORK: US natural gas futures spiked on Monday to their highest since March 2019 as the amount of gas flowing to liquefied natural gas (LNG) export plants jumps with units returning in Louisiana after Hurricane Delta and in Maryland after maintenance work.
Traders also noted prices were up on forecasts for colder weather and higher heating demand over the next two weeks and with output on track to drop to its lowest since July 2018 due mostly to well shut-ins for Delta.
Delta slammed into the Louisiana coast late Friday, causing over 878,000 customers to lose power. There were about 224,000 homes and businesses still without service Monday morning, mostly in Louisiana.
Front-month gas futures rose 14.0 cents, or 5.1%, to settle at $2.881 per million British thermal units, their highest close since March 2019. Data provider Refinitiv said output in the Lower 48 US states would slide from a 26-month low of 82.4 billion cubic feet per day (bcfd) over the weekend to a preliminary 82.0 bcfd on Monday due to the Delta shut-ins.
The US Bureau of Safety and Environmental Enforcement said energy firms started to return offshore production in the Gulf of Mexico. BSEE said that output was now curtailed by 1.3 bcfd, down from 1.7 bcfd on Sunday. In Louisiana, the Cameron and Sabine Pass LNG export plants both took in more pipeline gas over the weekend and tankers started to return to Sabine. There is also at least one vessel waiting in the Gulf of Mexico to go to Cameron, according to Refinitiv data.
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