U.S. natural gas futures hit a one-month high on Monday on forecasts for colder weather next week and a rise in LNG exports.
Natural Gas futures had risen by 6.48% as of 3:40 p.m. ET on Monday to $2.710, as U.S> LNG exports reached 12.8 bcf/d so far this month, up from 12.3 bcf/d last month. The monthly record for U.S. LNG exports was reached in March 2022, when the United States exported 12.9 bcf/d.
NGc1 for April delivery rose 13.4 cents on Monday, the first day trading as the front-month contract. NGc1 for March, which closed for trading on Friday, trading at $2.548 bcf/d.
Another reason for the sharp uptick in nat gas prices is the U.S. average gas output, which fell to 97.5 bcf/d so far this month from 98.3 bdf/d in January. These conditions were brought on in part due to freezing temperatures that took oil and gas wells offline in some areas of the United States, and partly due to falling nat gas prices so far in 2023 spooked energy firms into slashing the number of active drilling rigs.
Weather forecasters are indicating that the current cold snap could stick around through the middle of next month, although they have acknowledged we may see milder weather over the next few days.
The EIA estimates that the United States has 2,195 Bcf of working gas in underground storage in the Lower 48 states as of February 17-down 71 Bcf from the week prior. This compares to a significantly lower five-year average for this time of year of 1,906 Bcf. Last year at this time, the United States had 1,800 Bcf of working gas in underground storage.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More