NEW YORK: US natural gas futures jumped about 7% to a 13-year high on Monday on forecasts for hotter weather and higher demand than previously expected, a decline in output, rising liquefied natural gas (LNG) exports and record power demand in Texas.

Power demand in Texas is set to break the all-time record this week, far ahead of the hottest days of summer, testing the resilience of the state’s power grid after issues earlier this year and last year’s days-long blackout during a deep freeze.

Front-month gas futures for July delivery rose 63.3 cents, or 7.4%, to $9.156 per million British thermal units (mmBtu) at 10:08 a.m. EDT (1408 GMT), putting the contract on track for its highest close since August 2008.

Despite the jump in prices this week, speculators last week cut their net long futures and options positions on the New York Mercantile and Intercontinental Exchanges to their lowest since April 2020, according to the US Commodity Futures Trading Commission’s Commitments of Traders report. US gas futures were up about 142% so far this year, as much higher prices in Europe and Asia keep demand for US liquefied natural gas (LNG) exports strong, especially since Russia’s Feb. 24 invasion of Ukraine stoked fears that Moscow might cut gas supplies to Europe.

Gas was trading around $26 per mmBtu in Europe and $24 in Asia.

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US futures lag far behind global prices because the United States is the world’s top producer with all the gas it needs for domestic use, while capacity constraints inhibit additional LNG exports.