NEW YORK: US natural gas futures climbed about 2% to a one-week high on Monday on rising flows to liquefied natural gas (LNG) export plants, a drop in daily output and forecasts for colder weather and higher heating demand next week.
Front-month gas futures for March delivery on the New York Mercantile Exchange were up 5.3 cents, or 1.5%, to $3.497 per million British thermal units (mmBtu) at 7:55 a.m. EST (1255 GMT, putting the contract on track for its highest close since January 29 for a second day in a row.
Financial firm LSEG said average gas output in the Lower 48 US states rose to 106.0 billion cubic feet per day (bcfd) so far in February, up from 102.7 bcfd in January when freezing oil and gas wells and pipes, known as freeze-offs, cut production. That compares with a monthly record of 104.6 bcfd in December 2023.
But with the return of extreme cold and freezing wells in some parts of the country, daily output was on track to drop by 2.8 bcfd over the past five days to a preliminary two-week low of 103.9 bcfd on Tuesday. That compares with a daily record high of 106.7 bcfd on February 6. Analysts noted that preliminary data is often revised later in the day.
After extreme cold last month boosted heating demand to an all-time high, analysts said energy firms may have pulled a record amount of gas out of storage in January.
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