U.S. natural gas futures slipped on Friday and were headed for a weekly loss, weighed down by a milder weather view and increased supply.
Front-month gas futures for May delivery on the New York Mercantile Exchange (NYMEX) fell 1.2 cents, or 0.6%, to $2.00 per million British thermal units(mmBtu) by 1055 EDT.
Data provider Refinitiv estimated 103 cooling degree days (CDDs) over the next two weeks in the Lower 48 U.S. states. The normal for this time of year is 37 CDDs.
“Weather-related demand in the near term remains low,” said Gary Cunningham, director of market research at Tradition Energy.
However, “The market is also keeping an eye on outages at some of the LNG terminals. That’s certainly going to help pull gas demand back here.”
Refinitiv sees average gas output in the U.S. Lower 48 states has risen to 100.1 billion cubic feet per day (bcfd) so far in April, up from 98.7 bcfd in March. That compares with a monthly record of 100.4 bcfd in January 2023.
Prices fell 4% in the last session. For the week, prices were down about 0.6%.
“We are maintaining a view that a $1 price handle will prove too tempting for well-capitalized major hedge accounts or funds to ignore with some scale-down speculative buying likely especially if export demand improves and gas production further stalls,” Ritterbusch and Associates said in a note.
The U.S. Energy Information Administration (EIA) on Thursday said utilities put a near-normal 25 billion cubic feet (bcf) of gas into storage last week. That compares with an 8 bcf injection during the same week a year ago and a five-year (2018-2022) average rise of 28 bcf.
The Biden administration on Thursday approved exports of liquefied natural gas from the Alaska LNG project, a document showed, as the United States competes with Russia to ship natural gas from the Arctic to Asia.