CHICAGO: US natural gas futures rebounded on Friday as the weather outlook turned slightly warmer, potentially boosting demand for gas used for air conditioning. Front-month gas futures were up 10.7 cents, or 2.8%, at $3.937 per million British thermal units (mmBtu) by 10:23 a.m. EDT (1423 GMT).
Prices touched a one-month trough on Thursday, pressured by a weekly storage report that showed a larger-than-expected injection. "I think we'll see an expansion in the storage deficit going into next month and that's a dynamic that should lift us to about $4 and current price gains in face of a bearish storage report points to a fairly firm underpinning," said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.
Also, LNG exports should continue to support the market for the rest of 2021, Ritterbusch added.
According to Data provider Refinitiv, temperatures are expected to be slightly warmer in the next two weeks with 217 cooling degree days (CDDs). That compares with a 30-year average of 171 and 199 in Thursday's forecast.
Average US gas demand, including exports, is expected to rise from 93.1 billion cubic feet per day (bcfd) this week to 94.5 bcfd next week.
Refinitiv also said gas output in the US Lower 48 states has averaged about 92 bcfd so far in August, up from 91.6 bcfd in July. That compares with an all-time high of 95.4 bcfd in November 2019. The amount of gas flowing to US LNG export plants is expected to jump to 10.9 bcfd in the next two weeks.
Comments
Comments are closed for this article.