CHICAGO: US natural gas futures edged on Friday on forecasts for cooler weather and higher heating demand in mid- to late-April, the first time in seven weeks prices rose three straight days.
Traders noted that while temperatures may be lower, they were expected to remain at near- to above-normal levels during that time and liquefied natural gas (LNG) exports were expected to decline this month during routine plant and pipeline maintenance.
Traders also noted that mild weather this week will likely cause utilities to boost injections into storage by so much that the total amount of gas in inventory will rise above the five-year (2016-2020) average for the first time since the February freeze.
Front-month gas futures rose 0.4 cents, or 0.2%, to settle at $2.526 per million British thermal units, their highest since April 1. The last time the contract rose for three straight days was in mid February.
Even though the contract has been up for a few days in a row, big losses early in the week left the front-month down about 4% for the week after rising about 3% last week.
Data provider Refinitiv said output in the Lower 48 US states has averaged 91.9 billion cubic feet per day (bcfd) so far in April, up from 91.6 bcfd in March but still well below the record monthly high of 95.4 bcfd in November 2019.
Refinitiv projected average gas demand, including exports, would hold near 89.3 bcfd this week and next before rising to 91.4 bcfd in two weeks as the weather cools. The demand forecast for next week was higher than Refinitiv projected on Thursday.
The amount of gas flowing to US LNG export plants, meanwhile, has averaged 11.1 bcfd so far in April, which would top March’s monthly record of 10.8 bcfd.
On a daily basis, however, LNG feedgas fell to a one-month low of 9.7 bcfd on Thursday due to a reduction at Cheniere Energy Inc’s Corpus Christi in Texas for what traders said was planned work on the plant and the pipelines feeding it.
Traders said they expected feedgas to fall further later this month due to planned work at Cameron LNG’s plant in Louisiana and its pipelines.
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