NEW YORK: US natural gas futures climbed about 2% on Thursday on rising gas flows to liquefied natural gas (LNG) export plants and forecasts for hotter-than-normal weather and more demand over the next two weeks than previously expected.
Front-month gas futures for August delivery on the New York Mercantile Exchange (NYMEX) were up 4.7 cents, or 1.5%, to $3.261 per million British thermal units (mmBtu) at 8:54 a.m. EDT (1254 GMT). On Wednesday, the contract closed at its lowest price since May 28.
A federal storage report on Thursday is expected to show energy firms injected more gas into storage than normal last week for the 11th time in 12 weeks due to near-record production and low LNG export feedgas over the past few months.
Analysts forecast energy firms added 58 billion cubic feet (bcf) of gas into storage during the week ended July 4.
That compares with an increase of 61 bcf during the same week last year and an average of 53 bcf over the past five years (2020-2024).
If correct, that build would leave gas stockpiles about 6% above the five-year normal for this time of year.
Financial firm LSEG said average gas output in the Lower 48 US states has risen to 106.7 billion cubic feet per day (bcfd) so far in July, up from a monthly record high of 106.4 bcfd in June.
But on a daily basis, output has fallen by around 2.4 bcfd over six days to a four-week low of 105.1 bcfd on Wednesday. That daily output decline, however, was smaller than previously expected.
Meteorologists forecast weather across the Lower 48 states will remain mostly warmer than normal through at least July 25.With hotter weather expected, LSEG forecast average gas demand in the Lower 48, including exports, would rise from 107.3 bcfd this week to 108.8 bcfd next week. Those forecasts were higher than LSEG’s outlook on Wednesday.
Comments
Comments are closed for this article.