October Nymex natural gas (NGV24) on Wednesday closed down by -0.040 (-1.72%).
Oct nat-gas prices Wednesday posted moderate losses. Forecasts for seasonal US temperatures that will curb nat-gas demand from electricity providers to run air conditioning are weighing on prices. NatGasWeather said Wednesday that seasonal temperatures are expected across the northern two-thirds of the US from September 25-October 2.
Lower-48 state dry gas production Wednesday was 99.1 bcf/day (-2.2% y/y), according to BNEF. Lower-48 state gas demand Wednesday was 72.4 bcf/day (+9.6% y/y), according to BNEF. LNG net flows to US LNG export terminals Wednesday were 12.7 bcf/day (+6.2% w/w), according to BNEF.
An increase in US electricity output is positive for nat-gas demand from utility providers. The Edison Electric Institute reported Wednesday that total US electricity output in the week ended September 14 rose +0.51% y/y to 80,674 GWh (gigawatt hours), and US electricity output in the 52-week period ending September 14 rose +1.42% y/y to 4,141,969 GWh.
The consensus is that Thursday's weekly EIA nat-gas inventories will climb by +56 bcf for the week ending September 13.
Last Thursday's weekly EIA report was bullish for nat-gas prices since nat-gas inventories for the week ended September 6 rose +40 bcf, below expectations of +48 and well below the 5-year average build for this time of year of +67 bcf. As of September 6, nat-gas inventories were up +5.7% y/y and were +9.6% above their 5-year seasonal average, signaling ample nat-gas supplies. In Europe, gas storage was 93% full as of September 15, above 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 13 rose by +3 rigs to 97 rigs, rebounding from the prior week's 3-1/3 year low of 94 rigs. Active rigs have fallen back since posting a 5-year high of 166 rigs in Sep 2022, up from the pandemic-era record low of 68 rigs posted in July 2020 (data since 1987).
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.
