NEW YORK: US natural gas futures edged up on Tuesday after declining over the previous six days, buoyed by forecasts for cooler weather than previously expected for next week.
Traders also noted output was on track to drop with another Tropical Storm - Eta - in the Gulf of Mexico. Eta, however, is unlikely to cause as much damage as previous storms because it is expected to weaken by the time it hits the Florida-Alabama border on Sunday.
Front-month gas futures rose 2.8 cents, or 1%, to $2.887 per million British thermal units at 0845 EST (1345 GMT). Over the previous six days the contract lost about 15%.
Data provider Refinitiv said output in the Lower 48 US states was on track to drop by 3.6 billion cubic feet to a preliminary four-week low of 84.6 billion cubic feet per day (bcfd) on Tuesday. That would be the biggest one-day drop since at least 2011 and is likely to be revised down later in the day.
For the month, output has averaged 89.0 bcfd so far in November, up from a five-month low of 87.4 bcfd in October.
As the weather turns seasonally cooler, Refinitiv projected that demand, including exports, would jump next week to 101.4 bcfd, up from 90.9 bcfd this week.
The amount of gas flowing to US LNG export plants has averaged 10 bcfd so far in November, up from a five-month high of 7.7 bcfd in October, with rising global prices in recent months prompting buyers in Europe and Asia to purchase more US gas. That compares with a record monthly high of 8.7 bcfd in February.
In the spot market, mild weather this week cut next-day power and gas prices at the PJM West and Dominion South hubs in southwest Pennsylvania to a record low and their lowest since September 2016 respectively.
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