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NEW YORK: US natural gas futures edged up to a seven-week high on Wednesday on forecasts for cooler weather and higher heating demand over the next two weeks than previously expected.

That price increase also came as global demand for gas to replace Russian fuel after the country’s invasion of Ukraine keeps US liquefied natural gas (LNG) exports near record highs and European gas prices about seven times over US futures.

US front-month gas futures rose 4.5 cents, or 0.9%, to settle at $5.232 per million British thermal units (mmBtu), putting the contract on track for its highest close since Feb. 2 for a second day in a row.

The US market remains mostly shielded from higher global prices because the United States has all the fuel it needs for domestic use, and the country’s ability to export more LNG is constrained by limited capacity.

The United States is already producing LNG near full capacity. So, no matter how high global gas prices rise, it will not be able to export much more of the supercooled fuel. European gas jumped about 15% to around $37 per mmBtu on Wednesday after Russia demanded payment for gas in roubles.

Before Russia’s Feb. 24 invasion of Ukraine, the United States worked with other countries to ensure gas supplies, mostly from LNG, would keep flowing to Europe. Russia has provided around 30% to 40% of Europe’s gas, which totaled about 18.3 billion cubic feet per day (bcfd) in 2021.

Russia is the world’s second-biggest gas producer, after the United States.

Data provider Refinitiv said average gas output in the US Lower 48 states was on track to rise to 93.2 bcfd in March from 92.5 bcfd in February as more oil and gas wells return to service after freezing earlier in the year. That compares with a monthly record of 96.2 bcfd in December.

With cooler weather coming, Refinitiv projected average US gas demand, including exports, would rise from 96.4 bcfd this week to 102.6 bcfd next week. Those forecasts were higher than Refinitiv’s outlook on Tuesday.

Even though it will be cooler next week, meteorologists forecast US weather will remain at near normal levels through at least early April, which should keep heating demand low enough to allow utilities to inject gas into storage this week - about a week earlier than usual. In two weeks, however, supply and demand forecasts were about even and utilities will likely leave stockpiles little changed.

The amount of gas flowing to US LNG export plants rose to 12.76 bcfd so far in March from 12.43 bcfd in February and a record 12.44 bcfd in January. The United States has the capacity to turn about 12.7 bcfd of gas into LNG. The rest of the gas flowing to the plants is used to operate the facilities.

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