NEW YORK: US natural gas futures slid about 3% on Thursday from a 25-month high in the prior session on forecasts for less cold and lower heating demand next week than previously expected. Extreme cold blanketing much of the country this week boosted heating demand and cut output by freezing oil and gas wells, while at the same time flows to liquefied natural gas (LNG) export plants climbed to a record high.
Thursday’s price decline came despite a federal report expected to show utilities pulled more gas out of storage than usual to heat homes and businesses during frigid weather last week.
Analysts projected utilities pulled 188 billion cubic feet (bcf) of gas out of storage during the week ended February 14. That compares with a drop of 58 bcf during the same week last year and a five-year average draw of 145 bcf for this time of year.
Front-month gas futures for March delivery on the New York Mercantile Exchange fell 10.9 cents, or 2.6%, to $4.171 per million British thermal units (mmBtu) at 8:08 a.m. EST (1308 GMT). On Wednesday, the contract closed at its lowest since December 2022.
Despite Thursday’s price decline, the front-month remained in technically overbought territory for a third day in a row for the first time since October 2024.
Financial company LSEG said average gas output in the Lower 48 US states rose to 104.8 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.
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