NEW YORK: US natural gas futures eased on Tuesday as traders gauged Hurricane Ida's impact on demand, but strong consumption through August put prices on course for a fifth straight month of gains. "Traders are now balancing the current supply demand mix and looking at what the potential long-term impacts would be, so that, along with the approaching fall season, is resulting in a little bit of selling," said Robert DiDona of Energy Ventures Analysis, with a generally bullish sentiment limiting losses.
Front month gas futures for October delivery were down 1 cent, or 0.2%, to $4.295 per million British thermal units (mmBtu) by 9:45 am EDT (1345 GMT), falling as much as 2% earlier in the session.
However, the contract was on track to be up for the fifth consecutive month, rising about 9.7% so far. Late August saw the contract touch its highest since December 2018.
In August, "production numbers were higher, but demand numbers were up even higher. High international gas prices should continue to support that, and you have this good domestic power market that is pulling a lot of demand," DiDona added.
Data provider Refinitiv said total US production has averaged 91.7 billion cubic feet per day (bcfd) so far in August, versus 91.6 bcfd in July. That compares with an all-time monthly high of 95.4 bcfd in November 2019.
With European and Asian gas both trading over $16 per mmBtu, compared with just over $4 for the US fuel, analysts have said buyers around the world would keep purchasing all the liquefied natural gas (LNG) the United States can produce.
With a cooler season around the corner, data provider Refinitiv projected average US gas demand, including exports, would slide from 94.3 bcfd last week to 92.2 bcfd this week, as power generators burn less of the fuel with air conditioning demand easing.