NEW YORK: US natural gas futures fell on Tuesday, pressured by forecasts for mild weather leading to lower gas demand for heating.
Front-month gas futures for May delivery on the New York Mercantile Exchange were down 1.6 cents or 0.9% to $1.78 per million British thermal units (mmBtu) at 09:39 a.m. EDT.
“The weather forecast overnight continued to show a mild weather pattern, which is not favourable for any type of a rally in the natgas market,” said Gary Cunningham, director of market research at Tradition Energy.
Financial firm LSEG forecasts gas demand in the Lower 48 states, including exports, to fall to 93.1 bcfd next week from 97.8 bcfd this week.
Natural gas prices are down about 30% this year, pressured by mild weather conditions and above-normal stockpiles. Analysts projected gas stockpiles were about 35% above normal levels for this time of year.
Meanwhile, “LNG export feedgas has started to ramp back up, although still well below maximum levels, but we’re at least back in terms of global LNG demand and prices have started to pick up especially in the Pacific Rim,” Cunningham added.
On a daily basis, LNG feedgas was on track to rise to nearly a three-week high at 12.9 bcfd as the amount of gas flowing to Freeport LNG climbs to 0.8 bcfd from 0.1 bcfd on Friday.
The arrival of the tanker BW Pavilion Leeara at Freeport LNG’s gas liquefaction plant on Saturday signaled a potential restart in the coming days of one of the facility’s three gas-processing trains.
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