U.S. natural gas futures fell on Thursday as traders took profits after prices rose to a more-than a two-months high in the previous session, while market awaits a federal weekly storage report due later in the day.

Front-month, gas futures for November delivery on the New York Mercantile Exchange were down 0.8% to $3.45 per million British thermal units (mmBtu) as of 8:35 a.m. ET. The contract hit its highest level since July 18 in the previous session.

“We are seeing some pullback this morning as bullish investors take some profits and we retract from slightly overbought,” said Gary Cunningham, director of market research at Tradition Energy.

He added that the November contract is expected to find support around $3.40 and will likely trade within a range of $3.36 to $3.47.

The U.S. Energy Information Administration is scheduled to release its weekly storage report at 10:30 a.m. EDT (1430 GMT).

U.S. energy firms likely added a below-normal 68 billion cubic feet of natural gas into storage last week, according to the average estimate of analysts in a Reuters poll on Wednesday.

That compares with a boost of 54 bcf during the same week a year ago and a five-year (2020-2024) average build of 85 bcf for this time of year.

Financial firm LSEG said average gas output in the Lower 48 states fell to 106.0 billion cubic feet per day so far in October, down from 107.4 bcfd in September and a record monthly high of 108.3 bcfd in August.

LSEG projected average gas demand in the Lower 48 states, including exports, would slide from 101.5 bcfd this week to 99.2 bcfd next week.

On the storm front, Hurricane Imelda is expected to become an extra-tropical low later in the day, with gradual weakening forecast for the next several days.

Meanwhile, U.S. LNG exports hit a record in September at 9.4 million metric tons, beating their previous record of 9.3 million MT in August, according to preliminary data from financial firm LSEG.

Elsewhere, Dutch and British wholesale gas prices were little changed early on Thursday as lower LNG supply due to a strike in France was offset by weaker demand from power plants amid strong wind power output.
Source: Reuters