U.S. natural gas futures edged higher on Thursday, supported by a dip in daily output numbers, while the market awaited direction from a federal report expected to show a smaller-than-usual storage build last week.
Front-month gas futures were up 1.7% at $7.04 per million British thermal units as of 9:42 a.m. EDT (1342 GMT).
“As far as bullish signals this morning, our models are showing lower natural gas production this morning than at any time in the past week,” said John Abeln, an analyst with data provider Refinitiv. “A key factor in the recent bullishness is that production has not returned as quickly as most analysts have predicted.”
Data from Refinitiv showed average gas output in the U.S. Lower 48 states was at 94.4 billion cubic feet per day (bcfd) so far in April from 93.7 bcfd in March, down from December’s monthly record of 96.3 bcfd.
On a daily basis output was on track to drop about 0.4 bcfd to 93.2 bcfd on Thursday, according to preliminary Refinitiv data. Preliminary data is often revised.
Refinitiv estimated there would be 120 heating degree days (HDDs) over the next two weeks in the Lower 48 U.S. states, almost in-line with the 30-year norm of 119 HDDs for this time of year.
HDDs, used to estimate demand to heat homes and businesses, measure the number of days a day’s average temperature is below 65 degrees Fahrenheit (18 Celsius).