December Nymex natural gas (NGZ25) on Thursday closed up +0.141 (+3.70%).
Dec nat-gas prices on Thursday settled higher as US weather forecasts turned colder, potentially boosting heating demand for nat-gas. Forecaster Atmospheric G2 said Thursday that forecasts shifted cooler over the eastern half of the country for November 9-13. Thursday's weekly EIA inventory report showed supplies rose as expected and was neutral for nat-gas prices.
US (lower-48) dry gas production on Thursday was 107.1 bcf/day (+3.7% y/y), according to BNEF. Lower-48 state gas demand on Thursday was 79.2 bcf/day (+12.1% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Thursday were 16.7 bcf/day (-0.2% w/w), according to BNEF.
Higher US nat-gas production is a bearish factor for prices. On October 7, the EIA raised its forecast for 2025 US nat-gas production by +0.5% to 107.14 bcf/day from September's estimate of 106.60 bcf/day. US nat-gas production is currently near a record high, with active US nat-gas rigs recently posting a 2-year high.
As a supportive factor for gas prices, the Edison Electric Institute reported Wednesday that US (lower-48) electricity output in the week ended October 25 rose +1.9% y/y to 72,772 GWh (gigawatt hours), and US electricity output in the 52-week period ending October 25 rose +2.9% y/y to 4,282,176 GWh.
Thursday's weekly EIA report was neutral for nat-gas prices since nat-gas inventories for the week ended October 24 rose +74 bcf, right on the market consensus, but above the 5-year weekly average of +67 bcf. As of October 24, nat-gas inventories were up +0.5% y/y and were +4.6% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of October 28, gas storage in Europe was 83% full, compared to the 5-year seasonal average of 92% full for this time of year.
Baker Hughes reported last Friday that the number of active US nat-gas drilling rigs in the week ending October 24 was unchanged at 121 rigs, just below the 2.25-year high of 124 rigs posted on August 1. In the past year, the number of gas rigs has risen from the 4.5-year low of 94 rigs reported in September 2024.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
