NEW YORK: US natural gas futures eased to a fresh one-year low on Friday on forecasts for warmer-than-normal weather and lower than usual heating demand to continue into late January.

With the contract down about 17% so far this year, the gas market had its worst start to a year on record, according to Refinitiv data going back to 1991, the first full year of trade for the gas futures contract.

That tops the current worst four-day start to a year of down 14% in 2006, and compares with the best four-day start of up 21% in 1997.

Low heating demand during what is usually the coldest part of the year should allow utilities to leave more gas in storage than usual this month.

Front-month gas futures for February delivery fell 1.0 cent, or 0.3%, to settle at $3.710 per million British thermal units (mmBtu), their lowest close since Dec. 30.

Earlier on Friday, the contract dropped more than 5% to $3.52 per mmBtu, its lowest intraday price since July 2021.

For the week, the front month fell about 17%, putting it down about 44% over the past three weeks, its biggest three-week drop in history, according to Refinitiv data.

That keeps the contract in technically oversold territory, with a relative strength index (RSI) below 30 for a seventh day in a row for the first time since April 2019.

Traders said the market’s biggest uncertainty remains when Freeport LNG will restart its liquefied natural gas (LNG) export plant in Texas.

After several delays from October to November and then to December, Freeport now expects the facility to return in the second half of January, pending regulatory approvals. Analysts have long been saying that Freeport would likely return during the first or second quarter of 2023 because the company still has a lot of work to do to satisfy federal regulators, including training staff in new procedures, before restarting the plant.

Whenever Freeport returns, US demand for gas will jump. The plant can turn about 2.1 billion cubic feet per day (bcfd) of gas into LNG, which is about 2% of US daily production.

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