December Nymex natural gas (NGZ25) on Thursday closed up +0.125 (+2.95%).
Dec nat-gas prices moved higher on Thursday due to expectations that colder US temperatures will boost heating demand for nat-gas. Forecaster Atmospheric G2 said Thursday that forecasts shifted colder over the eastern US for November 11-15. Thursday's weekly EIA storage report was neutral for prices as nat-gas inventories rose+33 bcf for the week ended October 31, right on expectations but below the five-year average of +42 bcf.
US (lower-48) dry gas production on Thursday was 110.1 bcf/day (+8.4% y/y), according to BNEF. Lower-48 state gas demand on Thursday was 79.5 bcf/day (+1.5% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Thursday were 17.0 bcf/day (+2.1% w/w), according to BNEF.
As a supportive factor for gas prices, the Edison Electric Institute reported Wednesday that US (lower-48) electricity output in the week ended November 1 rose +0.05% y/y to 73,730 GWh (gigawatt hours), and US electricity output in the 52-week period ending November 1 rose +2.89% y/y to 4,282,216 GWh.
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.
Thursday's weekly EIA report was neutral for nat-gas prices since nat-gas inventories for the week ended October 31 rose +33 bcf, right on the market consensus, but below the 5-year weekly average of +42 bcf. As of October 31, nat-gas inventories were up +0.4% y/y and were +4.3% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of November 4, 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 31 rose by +4 to a 2.25-year high of 125 rigs. In the past year, the number of gas rigs has risen from the 4.5-year low of 94 rigs reported in September 2024.
