NEW YORK: US natural gas futures dropped 7% on Friday to a seven-month low after falling for nine weeks in a row in a move that could help cut US consumer heating costs this winter.
Prices have been falling for weeks due to forecasts for mild weather, record output and low liquefied natural gas (LNG) exports that have allowed utilities to inject more gas into storage than usual ahead of winter. Gas prices have plunged about 59% during the past nine weeks.
“Gas production has been strong and the ongoing shutdown of the Freeport LNG plant has allowed for a big comeback in storage. It was not too long ago that some folks were worried about whether we would have enough gas in storage for this winter,” said Phil Flynn, an analyst at Price Futures Group.
Freeport LNG in Texas shut for unplanned work after an explosion on June 8.
Front-month gas futures fell 39.9 cents, or 7.4%, to settle at $4.959 per million British thermal units (mmBtu), their lowest close since March 21.
That also put the front-month down for a sixth day in a row for the first time since February 2021 and kept it in technically oversold territory, with a relative strength index (RSI) below 30 for a fifth consecutive day for the first time since June 2022.
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