U.S. natural gas futures eased to a fresh two-week low on ample amounts of gas in storage and forecasts for mild weather through the end of October that should keep both heating and cooling demand low.

Front-month gas futures for November delivery on the New York Mercantile Exchange fell 1.7 cents, or 0.6%, to $3.011 per million British thermal units (mmBtu), putting the contract on track for its lowest close since September 26 for a second day in a row.

That small decline came despite record gas flows to liquefied natural gas (LNG) export plants and higher gas demand over the next two weeks than previously expected.

Looking forward, the market is showing signs that traders are not worried about having enough gas supplies in storage for the winter. The premium of futures for March over April 2026 was on track to fall to a record low of around 8 cents per mmBtu.

SUPPLY AND DEMAND

LSEG said average gas output in the Lower 48 states fell to 106.5 billion cubic feet per day so far in October, down from 107.4 bcfd in September and a record monthly high of 108.0 bcfd in August.

Record output earlier this year allowed energy companies to inject more gas into storage than usual. There is currently about 4% more gas in storage than normal for this time of year.

Meteorologists forecast the weather will remain mostly warmer than normal through October 30.

That late-season warmth should reduce gas demand by cutting the amount of fuel used to heat homes and businesses by more than it boosts the amount of fuel that power generators burn to keep air conditioners humming. About 40% of the power produced in the U.S. comes from burning gas.

LSEG projected average gas demand in the Lower 48 states, including exports, would rise from 100.0 bcfd this week to 101.3 bcfd next week. Those forecasts were higher than LSEG’s outlook on Tuesday.

The average amount of gas flowing to the eight big U.S. LNG export plants rose to 16.4 bcfd so far in October, up from 15.7 bcfd in September and a monthly record high of 16.0 bcfd in April.

On a daily basis, LNG export feedgas was on track to reach a record of 17.4 bcfd on Wednesday, which would top the current daily record high of 17.3 bcfd on April 9, with gas flows to Venture Global LNG’s 3.2-bcfd Plaquemines plant in Louisiana expected to hit an all-time high of 3.7 bcfd. LNG plants can pull in more gas than they can turn into LNG since they use some of the fuel to fuel equipment.
Source: Reuters