U.S. natgas futures rise on colder weather view, soaring LNG exports

U.S. natural gas futures rose to a more than one-week high on Monday on record liquefied natural gas (LNG) exports and expectations for higher heating demand as forecasts pointed to cooler weather.

Front-month gas futures rose 7.6 cents, or 3.1%, to $2.671 per million British thermal units at 9:35 a.m. EST (1435 GMT), putting the contract on track for its highest close since Dec. 3.

"Natural Gas futures are higher mainly due to supportive weather model runs which indicate a shift towards colder temperatures for the end of December," said Robert DiDona of Energy Ventures Analysis Chances of a big snowstorm that could impact the Mid-Atlantic and Northeastern portions of the country around mid-week were also supporting prices, DiDona added.

Data provider Refinitiv said output in the Lower 48 U.S. states averaged 90.8 billion cubic feet per day so far in December.

That compares with a seven-month high of 91.0 bcfd in November 2020 and an all-time monthly high of 95.4 bcfd in November 2019.

Refinitiv projected supply would fall from 99.5 billion cubic feet per day (bcfd) last week to 99.1 bcfd this week, before rising to 99.4 bcfd again in the next week.

With cooler weather coming, Refinitiv projected demand, including exports, would fall from an average of 125.0 bcfd this week to 123.2 bcfd next week.

The amount of gas flowing to U.S. LNG export plants, meanwhile, rose to an average of 10.9 bcfd so far in December, which would top November's 9.8 bcfd record.

Data provider Refinitiv predicted 423 heating degree days (HDDs) over the next two weeks in the Lower 48 U.S. states, up from the 396 HDDs estimated on Friday. HDDs measure the number of degrees a day's average temperature is below 65 Fahrenheit (18 Celsius) and are used to estimate demand to heat homes and businesses.