NEW YORK: US natural gas futures slipped more than 4% on Friday en route to their worst week in two months, taking cues from a retreat in European prices ahead of a planned resumption of Russian gas flows via the Nord Stream 1 pipeline.
Front-month gas futures for October delivery were down 37.7 cents, or 4.1%, to $8.89 per million British thermal units (mmBtu) by 10:15 a.m. EDT (1415 GMT).
The front-month contract has shed about 4.4% this week so far, the biggest drop since the week of July 1.
“The US gas market had been following European price swings through most of this week and today’s weakening across Europe is prompting renewed selling,” Ritterbusch and Associates said in a note.
“Russia has reportedly indicated that flows along the Gazprom pipeline system will be revived tomorrow in contributing to much of the weakness both here and abroad.”
Dutch and British wholesale gas prices fell to their lowest level since early August on indications that Nord Stream 1 flows will resume on Saturday, although analysts remained cautious.
Moreover, a federal report on Thursday showed US utilities added 61 billion cubic feet (bcf) of gas to storage during the week ended Aug. 26, just above the 58 bcf build forecast in a Reuters poll.
The restart delay at the fire-hit Freeport liquefied natural gas (LNG) export plant in Texas leaves more fuel in the United States for utilities to refill storage.
The export plant was consuming about 2 billion cubic feet per day (bcfd) of gas before it shut.
Traders also kept a close eye on the Atlantic as the hurricane season hits its peak. Tropical storms are closely watched, especially in the Gulf of Mexico, because of the threat they pose to offshore oil and natural gas production in the United States and Mexico.