NEW YORK: US natural gas futures eased to a two-month low on Wednesday on rising output and lower flows to liquefied natural gas (LNG) export plants due to maintenance at Freeport LNG’s facility in Texas.
Front-month gas futures for August delivery on the New York Mercantile Exchange fell 3.5 cents, or 1.2 percent, to USD2.869 per million British thermal units (mmBtu), putting the contract on track for its lowest close since May 13. Meteorologists forecast temperatures would top 90 degrees Fahrenheit (32.2 degrees Celsius) in many parts of the country on Wednesday, including New York and Chicago. That forecast compares with a normal high of 85 F in both cities for this time of year, according to weather forecaster AccuWeather.
As homes and businesses crank up their air conditioners to escape the heat, next-day power prices at the PJM Western Hub jumped 178 percent to around USD420 per megawatt hour. The PJM Western Hub is located mostly in western Pennsylvania and the District of Columbia/Maryland metro area.
Financial group LSEG said average gas output in the US Lower 48 states has risen to 110.1 billion cubic feet per day so far in July, up from 110.0 bcfd in June, but has remained below the monthly record high of 110.6 bcfd in December 2025.
Analysts said mostly mild weather during the spring allowed energy firms to stockpile more gas than usual. As they wait for a federal report on Thursday, they projected the amount of gas in storage was 6.6 percent above normal during the week ended July 10, the same as the previous week.
Meteorologists forecast the weather would remain mostly warmer than normal through July 30, forcing power generators to burn lots of gas to keep air conditioners humming. About 40 percent of US power generation comes from gas-fired plants.
LSEG projected average gas demand in the Lower 48 states, including exports, would slide from 111.1 bcfd this week to 110.4 bcfd next week. The forecast for this week was higher than LSEG’s outlook on Tuesday.
Average gas flows to the nine big US LNG export plants have risen to 17.5 bcfd so far in July, up from 17.4 bcfd in June, but have remained below the monthly record high of 18.8 bcfd in April. On a daily basis, however, LNG feedgas was on track to drop to a five-week low of 16.8 bcfd on Wednesday due mostly to a reduction in flows to Freeport LNG’s 2.4-bcfd export plant in Texas for planned work from July 10 to late August.
In other LNG news, the Al Fat’h LNG tanker was on track to reach China on July 16 with a load of fuel from US energy firm Venture Global LNG’s Plaquemines export plant in Louisiana. The vessel left the US in early June.
So far, no LNG tanker has left a US export plant and gone directly to China during US President Donald Trump’s second term, which started in January 2025, due primarily to trade disputes between the world’s two biggest economies.
China, which imported a large amount of US gas in the past and has many contracts to buy US LNG, is the world’s biggest gas importer, while the US is the world’s biggest gas producer, consumer and exporter. Chinese companies have bought US LNG and then sold it to buyers in other countries.