NEW YORK: US natural gas futures eased on Tuesday on expectations mild weather will allow energy firms to keep injecting more gas than usual into storage in the coming weeks.
On its last day as the front-month, gas futures for May delivery on the New York Mercantile Exchange fell 1.4 cents, or 0.5percent, to USD2.536 per million British thermal units (mmBtu).
That small price decline, which pushed the contract into technically oversold territory for the second time in three days, came despite a drop in output in recent weeks and near-record liquefied natural gas exports.
Futures for June, which will soon be the front-month contract, were unchanged at USD2.72 per mmBtu. In the cash market, some power and gas prices in Texas and California traded in negative territory for a third straight week as mild weather limited heating and cooling demand, which was met by ample amounts of hydro and other renewable energy sources.
Financial firm LSEG said average gas output in the US Lower 48 states fell to 110.1 billion cubic feet per day (bcfd) so far in April, down from 110.4 bcfd in March. That compares with a monthly record high of 110.7 bcfd in December 2025.
On a daily basis, output was on track to drop by around 3.8 bcfd over the past 22 days to a preliminary 12-week low of 108.3 bcfd on Tuesday as low spot prices prompted energy firms like EQT, the second-largest US gas producer, to temporarily reduce production. Preliminary data, however, is often revised later in the day.
Analysts said mostly mild weather this spring has allowed energy firms to inject more gas into storage than usual, boosting inventories to a forecast 8percent above normal levels during the week ended April 24 from 7percent above normal during the week ended April 17.
Looking ahead, meteorologists forecast the weather will remain slightly cooler than normal through May 13. Cool weather in May, however, does not usually generate a lot of heating demand but does knock out early spring air conditioning use.
LSEG projected average gas demand in the Lower 48 states, including exports, would slide from 101.9 bcfd this week to 100.4 bcfd next week. Those forecasts were similar to LSEG’s outlook on Monday.
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