US Natgas Prices Rebound

US natural gas futures climbed above $2.95 per MMBtu, extending their rebound from a two-month low as forecasts for hotter weather boosted expectations of stronger cooling demand. Meteorologists expect temperatures to remain mostly above normal through August 7, likely increasing natural gas consumption by power generators as air conditioning use rises. However, gains were capped by ample supply conditions. EIA data showed gas inventories were 6.4% above the five-year seasonal average as of July 17, while production in the Lower 48 states increased to an average of 110.4 bcfd so far in July, up from 110.0 bcfd in June. LNG export demand also eased, with gas flows to major export terminals averaging 17.4 bcfd so far this month, slightly below June's pace, partly due to scheduled maintenance at Freeport LNG's Texas facility. Meanwhile, Tropical Storm Bertha is being closely monitored as it could disrupt LNG export operations along the US Gulf Coast.

US natural gas futures fell below $2.90 per MMBtu, weighed down by adequate supplies and weaker LNG export flows. An EIA report showed that US energy firms added 32 bcf of gas to storage for the week ended July 17, exceeding the five-year average increase of 30 bcf. Inventories remained 6.4% above their five-year seasonal average, signaling comfortable supply conditions. In addition, average gas output in the Lower 48 states rose to 110.4 bcfd so far in July, up from 110.0 bcfd in June. Meanwhile, flows to major LNG export terminals declined to 17.2 bcfd in July so far from 17.4 bcfd in June, partly due to scheduled maintenance at Freeport LNG’s export facility in Texas. Tropical Storm Bertha also poses a potential threat to LNG export facilities along the Gulf Coast. Meanwhile, gas prices found some support from forecasts for warmer-than-normal weather conditions through August 7, which are likely to boost gas demand from power generators for air conditioning.

US natural gas futures rose above $2.9 per MMBtu, extending the rebound from a two-month low, supported by expectations of stronger demand in the coming weeks. Forecasts showed that weather conditions would remain mostly warmer than normal through August 5, potentially boosting gas demand from power generators for air conditioning. Limiting gains, however, gas inventories were 6.4% above their five-year seasonal average as of July 17, signaling comfortable supply conditions. On top of that, average gas output in the Lower 48 states rose to 110.4 bcfd so far in July from 110.0 bcfd in June. In addition, flows to major LNG export terminals fell to 17.3 bcfd in July so far from 17.4 bcfd in June, partly due to scheduled maintenance at Freeport LNG’s export facility in Texas, reducing the amount of gas being processed for exports and leaving more supply available in the domestic market. Tropical Storm Bertha also poses a potential threat to LNG export facilities along the Gulf Coast.