October Nymex natural gas (NGV25) on Wednesday closed up +0.005 (+0.18%).
Oct nat-gas prices settled slightly higher on Wednesday. Forecasts for warmer US weather, which will boost nat-gas demand from electricity providers to run air conditioning, are supporting nat-gas prices. Forecaster Atmospheric G2 said on Wednesday that forecasts shifted warmer across the central and northern US for September 29-October 3, and shifted warmer for most of the country for October 4-8.
Ample US nat-gas supplies are a bearish factor for prices. As of September 12, US nat-gas inventories were +6.3% above their 5-year seasonal average, a sign of abundant supplies.
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 Wednesday was 108.0 bcf/day (+5.6% y/y), according to BNEF. Lower-48 state gas demand on Wednesday was 75.8 bcf/day (+2.1% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Wednesday were 15.5 bcf/day (-0.6% 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 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.
The consensus is that Thursday's weekly EIA nat-gas inventories rose +74 bcf for the week ended September 19, just below the five-year average of +76 bcf.
Last Thursday's weekly EIA report was bearish for nat-gas prices since nat-gas inventories for the week ended September 12 rose +90 bcf, above the market consensus of +81 bcf and above the 5-year weekly average of +74 bcf. As of September 12, nat-gas inventories were down -0.3% y/y, but were +6.3% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of September 21, gas storage in Europe was 82% full, compared to the 5-year seasonal average of 88% 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 19 was unchanged at 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.
