NEW YORK: US natural gas futures edged up about 1 percent on Thursday on a bigger-than-expected storage withdrawal and forecasts for higher-than-expected demand this week.
Even though the shutdown of liquefied natural gas (LNG) export production in Qatar removed about 20 percent of global LNG supplies, prices in the US have not reacted much because the country was already exporting all the LNG it could produce. So, no matter how high global gas prices go - and they are higher - the US cannot export much more gas.
Front-month gas futures for April delivery on the New York Mercantile Exchange rose 2.3 cents, or 0.8 percent, to USD2.940 per million British thermal units (mmBtu).
The US Energy Information Administration (EIA) said energy firms pulled 132 billion cubic feet (bcf) of gas out of storage during the week ended February 27. Analysts noted that was higher than usual for this time of year because homes and businesses cranked up their heaters as a winter storm dumped massive amounts of snow in the Northeast and other parts of the country.
That withdrawal was more than the 121-bcf decrease analysts forecast in a Reuters poll and compares with a drop of 106 bcf during the same week last year and a five-year (2021-2025) average decline of 96 bcf for the period.
In cash markets, average gas prices at the Waha Hub in West Texas remained in negative territory for a record 20th day in a row, as pipeline constraints trapped gas in the nation’s biggest oil-producing basin.
In Arizona, meanwhile, next-day power prices at the Palo Verde hub fell to USD4.45 per megawatt-hour (MWh), its lowest since hitting a record low of 35 cents in May 2024.
Average gas output in the Lower 48 states rose to 109.5 billion cubic feet per day (bcfd) so far in March, up from 109.2 bcfd in February, according to data from financial firm LSEG. That compares with a monthly record high of 110.6 bcfd in December 2025.
Meteorologists forecast that weather across the country will remain mostly warmer than normal through March 20, which should keep heating demand and the amount of gas energy firms need to pull out of storage low in coming weeks.
LSEG projected average gas demand in the Lower 48 states, including exports, would drop from 124.0 bcfd this week to 111.9 bcfd next week. The forecast for this week was higher than LSEG’s outlook on Wednesday, while its forecast for next week was lower.
Average gas flows to the nine big US LNG export plants slid to 18.0 bcfd so far in March, down from a record 18.7 bcfd in February. Gas flows to QatarEnergy/ExxonMobil’s 2.4-bcfd Golden Pass export plant under construction in Texas were on track to fall to near zero on Wednesday and Thursday after averaging around 0.2 bcfd over the prior seven days. Energy analysts expect the plant to start producing first LNG in coming weeks.
In the Middle East, QatarEnergy halted LNG production and declared a force majeure due to the Iran war, causing gas prices around the world to soar. Qatar is one of the biggest LNG producers in the world along with the US and Australia.