November Nymex natural gas (NGX25) on Monday closed up +0.061 (+1.90%).
Nov nat-gas prices climbed to a 1-week high on Monday and settled higher as forecasts for above-average US temperatures could lead to increased demand from electricity providers to power ramped-up air conditioning usage. Forecaster Atmospheric G2 said Monday that forecasts shifted warmer across the eastern and southern US for October 4-8, and forecasts shifted warmer over the eastern half of the country for October 9-13.
Higher US nat-gas production has recently been a bearish factor for prices. Earlier this month, the EIA raised its forecast for 2025 US nat-gas production by +0.2% to 106.63 bcf/day from August's estimate of 106.40 bcf/day. US nat-gas production is currently near a record high, with active US nat-gas rigs recently posting a 2-year high.
US (lower-48) dry gas production on Monday was 108. bcf/day (+6.4% y/y), according to BNEF. Lower-48 state gas demand on Monday was 69.8 bcf/day (+4.4% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Monday were 15.8 bcf/day (+10.3% w/w), according to BNEF.
As a supportive factor for gas prices, the Edison Electric Institute reported last Wednesday that US (lower-48) electricity output in the week ended September 20 rose +2.3% y/y to 85,663 GWh (gigawatt hours), and US electricity output in the 52-week period ending September 20 rose +2.85% y/y to 4,267,164 GWh.
Last Thursday's weekly EIA report was neutral for nat-gas prices since nat-gas inventories for the week ended September 19 rose +75 bcf, just above the market consensus of +74 bcf but below the 5-year weekly average of +76 bcf. As of September 19, nat-gas inventories were up +0.5% y/y, and were +6.1% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of September 27, gas storage in Europe was 82% full, compared to the 5-year seasonal average of 89% 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 September 26 fell by -1 to 117 rigs, slightly below the 2-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.
