September Nymex natural gas (NGU25) on Wednesday closed up +0.020 (+0.71%).
Sep nat-gas prices on Wednesday fell to a new 9-month nearest-futures low but then staged a modest recovery rally to close higher. Nat-gas prices have been in a sharp sell-off mode since late June.
Don’t Miss a Day: From crude oil to coffee, sign up free for Barchart’s best-in-class commodity analysis.
Nat-gas prices have fallen sharply since late last week due to forecasts for cooler US temps and Tuesday's EIA forecast of higher gas production. Atmospheric G2 said Wednesday that forecasts shifted slightly cooler in the Northeast for Aug 18-22, and cooler for the eastern two-thirds of the US for Aug 23-27.
Nat-gas prices were undercut Tuesday when the EIA raised its forecast for 2025 US nat-gas production by +0.5% to 106.44 bcf/day from July's estimate of 105.9 bcf/day. The EIA raised its forecast for 2026 US nat-gas production by +0.7% to 106.09 from July's 105.4 bcf/day forecast. US nat-gas production is currently near a record high, with active US nat-gas rigs recently posting a 2-year high.
The consensus is for Thursday's weekly EIA report to show an increase of 54 bcf, which would be substantially higher than the average increase for the week of +33 bcf.
US (lower-48) dry gas production on Wednesday was 108.6 bcf/day (+5.4% y/y), according to BNEF. Lower-48 state gas demand on Wednesday was 81.8 bcf/day (+5.5% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Wednesday were 15.9 bcf/day (-2.4% w/w), according to BNEF.
In a bearish factor, the Edison Electric Institute reported Wednesday that US (lower-48) electricity output in the week ended August 9 fell -1.9% y/y to 93,293 GWh (gigawatt hours), although US electricity output in the 52-week period ending August 9 rose +2.6% y/y to 4,257,529 GWh.
Last Thursday's weekly EIA report was bullish for nat-gas prices since nat-gas inventories for the week ended August 1 rose +7 bcf, below the consensus of +12 bcf and the 5-year average of +29 bcf for the week. As of August 1, nat-gas inventories were down -4.3% y/y, but were +5.9% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of August 9, gas storage in Europe was 72% full, compared to the 5-year seasonal average of 79% full for this time of year.
Baker Hughes reported last Friday that the number of active US nat-gas drilling rigs in the week ending August 8 fell by -1 to 123 rigs, slipping from the 2-year high of 124 rigs posted on August 1. In the past ten months, the number of gas rigs has risen from the 4-year low of 94 rigs reported in September 2024.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
- Energy Commodities in Q2- Where are they Heading in Q3?
- Is a Summer Rally on the Horizon in the U.S. Natural Gas Futures Market?
- Will Natural Gas Prices Remain Elevated Throughout 2025?
- Energy Commodities in Q1 2025- Where are they Heading in Q2?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
