NEW YORK: US natural gas futures held near a one-week low on Friday on forecasts for less hot weather and lower air conditioning demand over the next two weeks than previously expected. Front-month gas futures rose 0.9 cents, or 0.3%, to $3.623 per million British thermal units (mmBtu) at 7:52 a.m. EDT (1152 GMT). On Thursday, the contract closed at its lowest since July 7 for a second day in a row.

For the week, the front-month was down a little over 1% after sliding a little under 1% last week. Data provider Refinitiv said US output in the Lower 48 states slipped to 91.3 billion cubic feet per day so far in July, due mostly to pipeline problems in West Virginia earlier in the month. That compares with an average of 92.2 bcfd in June and an all-time high of 95.4 bcfd in November 2019.

Refinitiv projected average gas demand, including exports, would rise from 91.3 bcfd this week to 92.5 bcfd next week and 93.5 bcfd in two weeks as the weather turns seasonally hotter. The forecasts for this week and next week, however, were lower than Refinitiv's projection on Thursday.

The amount of gas flowing to US liquefied natural gas (LNG) export plants averaged 10.9 bcfd so far in July, up from 10.1 bcfd in June but still below the record 11.5 bcfd in April.

With European and Asian gas trading near $12 and $13 per mmBtu, respectively, analysts said buyers around the world should keep purchasing all the LNG the United States can produce. US pipeline exports to Mexico, meanwhile, averaged 6.5 bcfd so far in July, down from a record 6.7 bcfd in June.

Comments

Comments are closed.