U.S. natural gas futures steadied into a tight range on Thursday ahead of a federal report expected to show a bigger-than-normal storage build last week.
Front-month gas futures were up 4.5 cents, or 0.5%, to $9.38 per million British thermal units (mmBtu) by 9:15 a.m. EDT (1315 GMT).
Analysts forecast that U.S. utilities added 58 billion cubic feet (bcf) of gas to storage during the week ended Aug. 19. That compares with an increase of 32 bcf in the same week last year and a five-year average increase of 46 bcf.
If correct, last week’s increase would boost stockpiles to 2.577 trillion cubic feet (tcf), or 12.1% below the five-year average for this time of the year.
Prices hit $10 per mmBtu for the first time since 2008 earlier this week, but have since retreated slightly after Freeport LNG said it now expects initial production to resume at its fire-hit Texas export plant only in November, delaying the timeline from an earlier estimate of October.
The second-biggest LNG export plant in the United States was consuming about 2 billion cubic feet per day (bcfd) of gas before it shut.
“Gas (is) consolidating within tight range as it further digests delayed Freeport restart amidst only modest support from (the) weather factor,” Ritterbusch and Associates said in a note.
But any significant storm activity near the Gulf of Mexico could preclude a significant reduction in the storage deficit until late September, it added.
Gas was trading around $87 per mmBtu in Europe and $66 in Asia.
Elsewhere, Dutch and British wholesale gas prices rose to their highest since March on Thursday in anticipation of Norwegian outages in September, lower French nuclear output and uncertainty about Russian gas flows after scheduled maintenance next week.
“The biggest threat to the energy sector’s strong performance is the combination of a deep recession eroding demand and a peaceful solution to the war in Ukraine sending EU gas prices sharply lower in anticipation of flows from Russia normalizing,” Ole Hansen, head of commodity strategy at Saxo Bank, said in a note.
Russian state energy giant Gazprom said last week the country would halt natural gas supplies to Europe for three days at the end of the month via its main pipeline into the region.