US natgas futures rise on colder forecasts, higher global prices

US natural gas futures rose almost 4% to a nearly two-week high on Monday on forecasts for colder weather and more heating demand over the next two weeks than previously expected.

In addition, traders noted gas prices around the world were trading at their highest in years, prompting buyers in Europe and Asia to buy more US liquefied natural gas (LNG).

Front-month gas futures on the New York Mercantile Exchange (NYMEX) rose 9.6 cents, or 3.8%, to $2.635 per million British thermal units at 9:35 a.m. EST (1435 GMT), putting the contract on track for its highest close since Dec. 22.

On Dec. 30, total futures volume on the NYMEX fell to a 20-month low of 202,965 contracts before rising to a preliminary two-day high of 318,633 on Dec. 31.

Data provider Refinitiv said output in the Lower 48 US states averaged 91.7 billion cubic feet per day (bcfd) so far in January. That compares with an eight-month high of 91.5 bcfd in December 2020 and an all-time monthly high of 95.4 bcfd in November 2019.

With colder weather coming, Refinitiv projected average demand, including exports, would rise from 121.1 bcfd this week to 126.1 bcfd next week.

The amount of gas flowing to US LNG export plants, meanwhile, has averaged 10.7 bcfd so far in January, which would match December's 10.7-bcfd record.

That all-time high comes as the third train at Cheniere Energy Inc's Corpus Christi LNG plant in Texas prepares to enter commercial service and gas prices hit their highest since October 2014 in Asia and January 2019 in Europe.