U.S. natural gas futures rose for a second straight session on Wednesday, tracking gains in crude oil, and moving further away from a 12-week low touched earlier in the week.
Front-month gas futures for November delivery rose 7.8 cents, or 1.1%, to $6.915 per million British thermal units (mmBtu), by 9:40 a.m. EDT.
Outside influences like higher oil prices were supporting natgas, after driving a bounce in the previous session in a risk-on environment, said Phil Flynn, analyst at Price Futures Group.
Oil prices have risen more than $1 per barrel. OPEC+ key ministers, known as the joint ministerial monitoring committee, have agreed oil production cuts of 2 million barrels per day, three OPEC+ sources said.
Gas was trading around $47 per mmBtu in Europe and $38 in Asia.
“Next month the exports are going to be huge and probably will be breaking records once we start to see LNG export terminals come out of maintenance and we get Freeport back online,” Flynn said, adding that the market will also be watching the weather in November for signs of a long, cold winter.
Data provider Refinitiv said average gas output in the U.S. Lower 48 states rose to 100.3 bcfd so far in October from a monthly record of 99.4 bcfd in September.
With cooler weather coming, Refinitiv projected average U.S. gas demand, including exports, would rise from 90.1 bcfd this week to 90.8 bcfd next week. The forecast for both weeks was higher than Refinitiv’s outlook on Tuesday.
The average amount of gas flowing to U.S. LNG export plants fell to 11.0 bcfd so far in October from 11.5 bcfd in September. That compares with a monthly record of 12.9 bcfd in March. The seven big U.S. export plants can turn about 13.8 bcfd of gas into LNG.