US natgas futures retreat on lower cooling demand

US natural gas futures fell on Thursday on lower air-conditioning demand after Hurricane Laura turned the weather cooler and knocked out power to houses and businesses.

Front-month gas futures fell 4.6 cents, or 1.9%, to $2.441 per million British thermal units (mmBtu) by 10:21 AM EDT (1421 GMT)

The front-month was en route to its first weekly fall in five and at a decline of over 8%, its worst performance since the week ended June 26.

"We're very slow to return the LNG demand due to the storms in the gulf last week; there are still a lot of electrical outages that's limiting it. So we are seeing some price congestion ahead of the long holiday weekend," said Robert DiDona of Energy Ventures Analysis.

"The overall lower demand along with relatively flat production estimates since last week is creating a little bit of a pause in what was an upward momentum market," DiDona said.

Laura took out power in thousands of homes and businesses in Louisiana, Texas and Arkansas after slamming into the Gulf Coast near the Texas-Louisiana border last week as a major Category 4 storm.

Demand in the Lower 48 is expected to decline slightly, falling from 83.9 billion cubic feet per day (bcfd) this week to 83.6 bcfd in the next, according to Refinitiv.

Refinitiv data indicated 137 cooling degree days in the Lower 48 states over the next two weeks, decreasing from 148 CDDs the previous day.

CDDs measure the number of degrees a day's average temperature is above 65 degrees Fahrenheit (18 degrees Celsius) and are used to estimate demand to cool homes and businesses.

Natural gas output from the Gulf of Mexico was down by 16%, or 420 million cubic feet per day (mmcfd), on Thursday, the US Bureau of Safety and Environmental Enforcement said.