NEW YORK: US natural gas futures slipped almost 2% on Friday on forecasts the weather will moderate and air-conditioning demand decline now that the hottest days of summer are past. Front-month gas futures fell 3.0 cents, or 1.6%, to settle at $1.799 per million British thermal units.
For the week, the contract was down less than 1% after rising over 5% last week, and for the month, the contract was up almost 3% after falling more than 10% in the prior two months. In the Atlantic, Hurricane Isaias is expected to march up the US East Coast from Florida to Maine over the next five days after battering the Bahamas on Friday. Traders noted storms in nonproduction areas tend to cut demand.
With the weather expected to moderate, data provider Refinitiv projected US demand, including exports, will drop from 91.9 billion cubic feet per day (bcfd) this week to 89.3 bcfd next week before rising to 92.1 bcfd in two weeks with liquefied natural gas (LNG) exports expected to increase.
Pipeline gas flowing to US LNG export plants averaged 3.3 bcfd (34% utilization) so far in July after buyers canceled dozens of cargoes, down from a 20-month low of 4.1 bcfd in June and a record 8.7 bcfd in February. Utilization was about 90% in 2019. Analysts expect LNG exports to rise in August since buyers have so far canceled fewer cargoes that month.
Refinitiv said pipeline exports to Canada averaged 2.4 bcfd so far in July, up from 2.3 bcfd in June, but still below the all-time monthly high of 3.5 bcfd in December. Pipeline exports to Mexico averaged 5.65 bcfd so far this month, up from 5.44 bcfd in June and on track to top the record 5.55 bcfd in March.
Comments
Comments are closed for this article.