NEW YORK: US natural gas futures eased on Wednesday on forecasts for demand to slowly decline now that the hottest part of the summer is past.
That move lower came despite a drop in output this week due to pipeline maintenance and a steady increase in liquefied natural gas (LNG) exports.
Front-month gas futures fell 1.9 cents, or 0.9%, to settle at $2.152 per million British thermal units, their lowest close since the start of August and down about 4% from last week's highest close since December.
Although US and European gas contracts mostly trade on their own fundamentals, Wednesday's 5% price drop at the European Title Transfer Facility (TTF) benchmark in the Netherlands on Wednesday weighed on US gas.
For the month, however, TTF was still up 35%, which made it profitable for more US LNG to go to Europe.
US LNG exports were on track to rise in August for the first time in six months. Pipeline gas flowing to the plants climbed to 4.2 billion cubic feet per day (bcfd) so far this month from a 21-month low of 3.3 bcfd in July. Buyers canceled dozens of cargoes in July, the most of any month so far.
Refinitiv projected US demand, including exports, will slip from an average of 89.3 bcfd this week to 88.8 bcfd next week as the hot weather moderates.
US output is on track to fall about 2.2 bcfd to a near one-month low of 87.4 bcfd over the past two days due mostly to maintenance work this week on TC Energy Corp's Mountaineer Xpress pipeline in West Virginia, according to preliminary data from Refinitiv that is subject to change later in the day.
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