NEW YORK: US natural gas futures rose about 1% to a fresh 14-year high on Thursday as hot weather boosted spot prices across the country to multiyear highs amid record global gas prices and forecasts for more US demand over the next two weeks than previously expected.
That futures price increase also came ahead of a federal report expected to show a smaller than usual storage build last week when power generators burned lots of gas to keep air conditioners humming during a heat wave.
Analysts forecast US utilities added 34 billion cubic feet (bcf) of gas to storage during the week ended Aug. 12. That compares with an increase of 46 bcf in the same week last year and a five-year (2017-2021) average increase of 47 bcf.
If correct, last week’s increase would boost stockpiles to 2.535 trillion cubic feet (tcf), or 12.2% below the five-year average of 2.886 tcf for this time of the year.
The small storage increase came despite the ongoing outage at the Freeport liquefied natural gas (LNG) export plant in Texas, which has left more gas in the United States for utilities to inject into stockpiles for next winter.
Freeport LNG, the second-biggest US LNG export plant, was consuming about 2 billion cubic feet per day (bcfd) of gas before it was shut on June 8. Freeport expects the plant to return to at least partial service in early October.
Front-month gas futures rose 13.3 cents, or 1.4%, to $9.377 per million British thermal units (mmBtu) by 8:01 a.m. EDT (1201 GMT), putting the contract on track for its highest close since August 2008.
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