November Nymex natural gas (NGX25) on Monday closed up by +0.033 (+0.99%).
Nov nat-gas prices settled higher on Monday on forecasts for cooler US temperatures, which could boost heating demand for nat-gas. Forecaster Atmospheric G2 said Monday that forecasts shifted cooler across the US for October 16-20.
Last Thursday, nat-gas prices jumped to a 2.5-month nearest-futures high due to a smaller-than-normal build in weekly gas storage. The EIA reported Thursday that nat-gas inventories rose +53 bcf for the week ended September 26, below expectations of +64 bcf.
Higher US nat-gas production has recently been a bearish factor for prices. Last 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 107.6 bcf/day (+4.9% y/y), according to BNEF. Lower-48 state gas demand on Monday was 68.8 bcf/day (+0.1% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Monday were 15.8 bcf/day (+2.8% 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 27 rose +5.96% y/y to 84,530 GWh (gigawatt hours), and US electricity output in the 52-week period ending September 27 rose +2.9% y/y to 4,271,916 GWh.
Last Thursday's weekly EIA report was bullish for nat-gas prices since nat-gas inventories for the week ended September 26 rose +53 bcf, below the market consensus of +64 bcf and below the 5-year weekly average of +85 bcf. As of September 26, nat-gas inventories were up +0.4% y/y, and were +5.0% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of September 30, gas storage in Europe was 85% full, compared to the 5-year seasonal average of 90% 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 3 rose by +1 to 118 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.
