NEW YORK: US natural gas futures slid about 2percent to a 17-month low on Friday on forecasts for the weather to remain mild and demand low through early May, allowing energy firms to keep injecting more gas into storage in coming weeks.
Front-month gas futures for May delivery on the New York Mercantile Exchange fell 5.0 cents, or 1.9percent, to USD2.564 per million British thermal units (mmBtu), putting the contract on track for its lowest close since October 29, 2024.
That decline pushed the front-month into technically oversold territory for the first time since mid-April.
For the week, the contract was down about 5percent after gaining about 1percent last week. In the cash market, some power and gas prices in Texas and California traded in negative territory this week as mild weather kept both heating and cooling use low, allowing ample amounts of hydro and other renewable sources of energy to meet more demand.
Financial firm LSEG said average gas output in the US Lower 48 states eased to 110.2 billion cubic feet per day (bcfd) so far in April, down from 110.4 bcfd in March. That compares with a monthly record high of 110.7 bcfd in December 2025. On a daily basis, output was on track to drop by around 4.1 bcfd over the past 18 days to a preliminary 11-week low of 108.1 bcfd on Friday, as low spot prices prompt energy firms like EQT, the second-biggest US gas producer, to cut production. Preliminary data, however, is often revised later in the day.
Looking ahead, meteorologists forecast the weather will remain slightly cooler than normal through May 9. Cool weather in late April and early May, however, does not cause much heating demand and also reduces the chances of early season air conditioning use.
Analysts said mostly mild weather so far this spring has allowed energy firms to inject more gas into storage than usual, boosting inventories to a forecast 8percent above normal levels during the week ended April 24, up from 7percent above normal during the week ended April 17.
LSEG projected average gas demand in the Lower 48 states, including exports, would slide from 103.7 bcfd this week to 100.6 bcfd next week and 100.0 bcfd in two weeks. The forecasts for this week and next were similar to LSEG’s outlook on Thursday.
Average gas flows to the nine big US LNG export plants rose to 18.9 bcfd so far in April, up from 18.6 bcfd in March. That reading compares with a monthly record high of 18.7 bcfd in February.