NEW YORK: US natural gas futures dropped about 6% to a three-month low on Monday with a collapse in European forwards to a four-month low and forecasts for milder US weather and lower demand next week than previously expected.
US gas futures have already been declining for the past eight weeks on record output and reduced liquefied natural gas (LNG) exports that have allowed utilities to inject much bigger than normal amounts of gas into storage over the past month.
Major LNG outages include Berkshire Hathaway Energy’s shutdown of its 0.8-billion-cubic-feet-per-day (bcfd) Cove Point LNG export plant in Maryland for about three weeks of planned maintenance on Oct. 1 and the continuing shutdown of Freeport LNG’s 2.0-bcfd plant in Texas for unplanned work after an explosion on June 8. Freeport expects the facility to return to at least partial service in early to mid-November.
There are at least three vessels currently heading to Freeport, according to Refinitiv data, including Prism Brilliance (expected to arrive Oct. 18), Prism Diversity (Oct. 27) and Seapeak Methane (Nov. 22), prompting some traders to believe Freeport will return in November. Others in the market, however, believe the plant’s return will be delayed. Officials at Freeport said they remain on track to return the plant in November.
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