NEW YORK: US natural gas futures eased on Wednesday on forecasts for milder weather and lower heating demand over the next two weeks than previously expected.

That decline comes even as power and gas prices in the Northeast rose to their highest in almost a year as the region prepared for its first major winter storm of the season.

Front-month gas futures fell 0.5 cent, or 0.2%, to settle at $2.677 per million British thermal units.

Data provider Refinitiv said output in the Lower 48 US states averaged 90.8 billion cubic feet per day so far in December. That compares with a seven-month high of 91.0 bcfd in November 2020 and an all-time monthly high of 95.4 bcfd in November 2019.

With the weather expected to turn milder, Refinitiv projected average demand, including exports, would slip from 123.4 bcfd this week to 121.7 bcfd next week.

The amount of gas flowing to US LNG export plants, meanwhile, averaged 10.7 bcfd so far in December, which would top November’s 9.8-bcfd record.

That increase comes despite brief reductions at Cheniere Energy Inc’s export plants at Sabine Pass in Louisiana and Corpus Christi in Texas and Cameron LNG’s plant in Louisiana over the past couple of days. Most of those reductions were already reversed by Wednesday morning, according to data from Refinitiv.

Traders, however, noted LNG exports cannot rise much more until new units enter service in the second half of 2022 since feedgas to the LNG plants was already over their 10.5-bcfd export capacity. LNG plants can pull in a little more gas than they can export since they use some of the fuel to run the facility.—Reuters