NEW YORK: US natural gas futures dropped about 5% on Tuesday on forecasts for the weather to remain mild for the next two weeks, which should allow utilities to keep injecting gas into storage for the winter through at least mid November.
That price decline came despite forecasts for higher demand over the next two weeks than previously expected and a projected increase in liquefied natural gas (LNG) exports once Freeport LNG’s export plant in Texas returns to service.
Freeport LNG expects its 2.1-billion-cubic-feet-per-day (bcfd) export plant to return to at least partial service in early- to mid-November following an unexpected shutdown on June 8 caused by a pipeline explosion.
At least four vessels were already lined up to pick up LNG at Freeport, according to Refinitiv data. Prism Brilliance and Prism Diversity were waiting off the coast from the plant, while Prism Courage was expected to arrive on Nov. 4 and Grace Freesia in December.
Front-month gas futures fell 28.7 cents, or 4.5%, to $6.068 per million British thermal units (mmBtu) at 8:51 a.m. EDT (1251 GMT). On Monday, the contract soared about 12% to its highest since Oct. 14.
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