US natural gas futures slip on forecasts for lower demand
- Front-month gas futures fell 6.2 cents, or 1.9%, to $3.153 per million British thermal units (mmBtu) .
- US pipeline exports to Mexico averaged 6.7 bcfd so far in June, putting them on track to top May's 6.2-bcfd record.
US natural gas futures slipped to a fresh one-week low on Monday on forecasts for lower demand over the next two weeks than previously expected.
Front-month gas futures fell 6.2 cents, or 1.9%, to $3.153 per million British thermal units (mmBtu) at 9:13 a.m. EDT (1313 GMT), putting the contract on track for its lowest close since June 10 for a second day in a row.
Data provider Refinitiv said gas output in the Lower 48 US states averaged 91.6 billion cubic feet per day (bcfd) so far in June, up from 91.0 bcfd in May but still well below the monthly record high of 95.4 bcfd in November 2019.
With the coming of hotter summer weather, Refinitiv projected average gas demand, including exports, would rise from 88.0 bcfd this week to 92.0 bcfd next week. Those forecasts, however, were lower than Refinitiv projected on Friday.
The amount of gas flowing to US LNG export plants averaged 9.8 bcfd so far in June, down from 10.8 bcfd in May and an all-time high of 11.5 bcfd in April. Traders noted LNG feedgas was down this month mostly due to short-term maintenance at the Sabine Pass and Cameron export plants in Louisiana and some of the pipelines that provide them with fuel.
But with European and Asian gas prices both over $10 per mmBtu, analysts said they expect buyers around the world to keep purchasing all the LNG the United States can produce.
US pipeline exports to Mexico averaged 6.7 bcfd so far in June, putting them on track to top May's 6.2-bcfd record.
In the power market, brutal heatwaves tested the California and Texas electric grids last week. Both passed those tests by not being forced to impose rotating blackouts after consumers heeded calls to conserve energy.
Peak demand for power in the Electric Reliability Council of Texas (ERCOT), which operates the grid in most of Texas, soared to a record for the month of June of 69,943 megawatts (MW) on June 14. ERCOT projected peak demand would break that June record on June 24 at 71,496 MW and June 25 at 71,510 MW.
Comments
Comments are closed.