NEW YORK: US natural gas futures held near a 26-month high on Thursday as the market waited for direction from a federal report expected to show last week’s storage withdrawal was near normal for this time of year. Gas prices spiked earlier this week on record flows to liquefied natural gas export (LNG) plants and worries Canada would reduce power and gas exports to the US after US President Donald Trump imposed tariffs on Canada and Mexico on March 4.
In 2024, Canada supplied about 8% of total US gas demand, including exports, and about 1% of total US power demand, again including exports. Some of those power and gas exports returned to Canada.
Front-month gas futures for April delivery on the New York Mercantile Exchange were down 0.6 cents, or 0.1%, to $4.444 per million British thermal units (mmBtu) at 8:33 a.m. EST (1333 GMT). On Wednesday, the contract closed at its highest price since December 2022 for a second day in a row.
Prices are up about 14% so far this week despite near-record output and forecasts for mostly mild weather through mid-March, which should allow utilities to pull less gas out of storage over the next week or two.
Analysts projected utilities pulled 92 billion cubic feet (bcf) of gas out of storage during the week ended February 28. That compares with declines of 56 bcf during the same week last year and a five-year average draw of 94 bcf for this time of year.
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