US natural gas futures on Thursday edged lower to a fresh nine-week low on a slightly bigger-than-expected storage build and forecasts for less-hot weather over the next two weeks. The US Energy Information Administration said utilities added 29 billion cubic feet of gas during the week ended August 5, topping the 25 bcf estimated by analysts in a Reuters poll.
Front-month gas futures for September delivery on the New York Mercantile Exchange fell one cent, or 0.4 percent, to settle at $2.551 per million British thermal units. That kept the front-month contract in oversold territory for a second consecutive day for the first time since March. In addition, the contract also declined for a sixth day in a row, its longest losing streak since December.
Traders said the front-month was now down 15 percent from a recent 14-month high near $3 on July 1, due in part to the mountain of gas in storage and slow but steady production increases as pipelines exit maintenance outages. Despite smaller-than-normal injections since April, analysts still expect stockpiles to start the winter heating season in November at an all-time high after utilities left record amounts of gas in storage after the mild winter of 2015-2016. That inventory glut has kept a lid on next-day prices at the Henry Hub benchmark in Louisiana, which have averaged $2.19 so far this year. That compares with $2.61 in 2015, the lowest price since 1999.
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