US Natgas Prices Rise to 11-Week High

US natural gas prices fell more than 5% on Friday to nearly $2.65 per MMBtu, approaching their lowest level since late April, as forecasts for milder weather weighed on expectations for heating demand. Above-average temperatures are expected across the Midwest and East through November 5, according to Commodity Weather Group, likely curbing gas consumption. The price decline came despite a smaller-than-usual storage build, strong LNG feedgas demand, and lower production. EIA data showed that US natural gas inventories rose by 77 Bcf in the week ended October 16, below both the 86 Bcf added during the same week last year and the five-year average increase of 87 Bcf. Meanwhile, average feedgas flows to the nine major US LNG export terminals climbed to 18.2 Bcf/d in October, up from 17.9 Bcf/d in September. On the supply side, production across the Lower 48 states averaged 111.4 Bcf/d this month, down from record highs of 113.3 Bcf/d in August and September.

US natural gas prices retreated on Friday to a two-month low of $2.72 per MMBtu, reversing a modest gain in the previous session as mild weather forecasts weighed on expected heating demand. Above-average temperatures are expected across the Midwest and East through November 5, according to Commodity Weather Group, likely limiting gas consumption. This outweighed support from a smaller-than-usual storage build, strong LNG feedgas demand, and lower production. EIA data showed that energy companies added 77 bcf of natural gas to storage in the week ended October 16, below the 86 bcf injected during the same week last year and the five-year average of 87 bcf. Meanwhile, average gas flows to the nine major US LNG export facilities rose to 18.2 bcfd in October, up from 17.9 bcfd in September. On the supply side, natural gas production across the Lower 48 states averaged 111.4 bcfd this month, down from record highs of 113.3 bcfd in August and September.

US natural gas prices rebounded to $2.81 per MMBtu, recovering slightly from a two-month low of $2.79 recorded on October 21, after the EIA reported a smaller-than-expected weekly increase in storage inventories. Lower production earlier this month likely contributed to reduced gas injections, with energy companies adding 77 billion cubic feet (bcf) to storage in the week ended October 16, below market expectations of 79 bcf. The increase was also lower than the 86 bcf added during the same week last year and the five-year average of 87 bcf. Total inventories reached 3.644 trillion cubic feet, 4% below year-earlier levels but 1% above the five-year average. Meanwhile, average natural gas output across the Lower 48 states declined from record highs of 113.3 billion cubic feet per day (bcfd) in August and September to 111.6 bcfd so far in October. In contrast, average gas flows to the nine major US LNG export facilities increased to 18.1 bcfd in October, up from 17.9 bcfd in September.