US natural gas futures were little changed on Thursday as forecasts for cooler weather, higher heating demand and slowing output offset a bigger-than-expected storage draw last week and a collapse in global liquefied natural gas (LNG) prices.
That keeps prices within a nickel of a near four-year low.
The US Energy Information Administration (EIA) said utilities pulled 137 billion cubic feet (bcf) of gas from storage during the week ended Jan. 31.
That was higher than the 129-bcf draw analysts forecast in a Reuters poll and compares with a decline of 228 bcf during the same week last year and a five-year (2015-19) average reduction of 143 bcf for the period.
The decrease for the week ended Jan. 31 cut stockpiles to 2.609 trillion cubic feet (tcf), 8.3% above the five-year average of 2.410 tcf for this time of year.
Front-month gas futures for March delivery on the New York Mercantile Exchange rose 0.1 cent, or 0.1%, to settle at $1.862 per million British thermal units (mmBtu). On Monday, the contract closed at $1.819, its lowest settle since March 2016.
Since hitting an eight-month high of $2.905 per mmBtu in early November, futures have collapsed 36%. Record production and mild weather have enabled utilities to leave more gas in storage, making shortages and winter price spikes unlikely.
Shares of US LNG companies tumbled as China's biggest importer of the fuel suspended some purchases amid weaker demand and a global glut that has driven prices to record lows.
In Texas, meanwhile, forward gas prices at the Waha hub in the Permian basin fell into negative territory for March-June on expectations there will not be enough pipelines to transport all the gas associated with the region's record oil production.
Gas output in the US Lower 48 states fell from 93.7 billion cubic feet per day (bcfd) on Tuesday to a near five-month low of 92.5 bcfd on Wednesday due primarily to temporary well freeze-offs in Texas during a snowstorm, according to traders and Refinitiv data. That compares with an average of 94.1 bcfd last week and an all-time high of 96.8 bcfd on November 30.
Meteorologists projected weather in the Lower 48 states will remain near normal through Feb. 13 before turning colder from Feb. 14-20. That is colder than Wednesday's outlook, which called for cold only from February 17-20.
Refinitiv projected average demand in the Lower 48, including exports, would rise from 116.8 bcfd this week to 122.9 bcfd next week. That is higher than Wednesday's outlook due to forecasts for increased heating demand.