December Nymex natural gas (NGZ25) on Monday closed down by -0.031 (-0.68%).
Dec nat-gas prices settled lower on Monday due to a mixed US weather forecast, potentially curbing nat-gas heating demand. Forecaster Atmospheric G2 said Monday that forecasts shifted colder across the eastern two-thirds of the US for November 29-December 3, but warmer in the Southeast and West. Also, record-high US nat-gas production weighed on prices after BNEF data showed that lower-48 nat-gas production rose to a record 112.2 bcf/day on Monday.
Higher US nat-gas production is a bearish factor for prices. On November 12, the EIA raised its forecast for 2025 US nat-gas production by +1.0% to 107.67 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.
US (lower-48) dry gas production on Monday was 112.2 bcf/day (+8.3% y/y), according to BNEF. Lower-48 state gas demand on Monday was 83.1 bcf/day (+4.9% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Monday were 17.7 bcf/day (+0.2% 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 November 15 rose +5.33% y/y to 75,586 GWh (gigawatt hours), and US electricity output in the 52-week period ending November 15 rose +2.9% y/y to 4,286,124 GWh.
Last Thursday's weekly EIA report was bullish for nat-gas prices, as nat-gas inventories for the week ended November 14 fell by -14 bcf, a larger draw than the market consensus of -12 bcf and well below the 5-year weekly average of a +12 bcf increase. As of November 14, nat-gas inventories were down -0.6% y/y and were +3.8% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of November 18, gas storage in Europe was 81% 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 November 21 rose by +2 to 127 rigs, just below the 2.25-year high of 128 rigs from November 7. In the past year, the number of gas rigs has risen from the 4.5-year low of 94 rigs reported in September 2024.
