August Nymex natural gas (NGQ25) on Thursday closed down by -0.079 (-2.26%).
Aug nat-gas prices on Thursday fell after the weekly EIA report showed that nat-gas inventories rose by +55 bcf, which was a bigger increase than expectations of +49 bcf although lower than the 5-year average of +61 bcf. The report indicated that inventories were plentiful, 6.2% above the 5-year average.
Natural gas prices received support from a warmer shift in temperatures in the Midwest and expectations for above-normal temperatures in the West for July 8-12, according to Vaisala. Also, temperature forecasts shifted warmer for the eastern half of the US for July 13-17.
Lower-48 state dry gas production on Thursday was 107.4 bcf/day (+3.3% y/y), according to BNEF. Lower-48 state gas demand on Thursday was 74.0 bcf/day (-5.4% y/y), according to BNEF. Estimated LNG net flows to US LNG export terminals on Thursday were 15.0 bcf/day (+0.2% w/w), according to BNEF.
An increase in US electricity output is positive for nat-gas demand from utility providers. The Edison Electric Institute reported Wednesday that total US (lower-48) electricity output in the week ended June 28 rose +3.2% y/y to 99,357 GWh (gigawatt hours), and US electricity output in the 52-week period ending June 28 rose +2.5% y/y to 4,246,983 GWh.
Thursday’s weekly EIA report was bearish for nat-gas prices since nat-gas inventories for the week ended June 27 rose +55 bcf, above the consensus of +49 bcf but below the 5-year average for the week of +61 bcf. As of June 27, nat-gas inventories were down -5.8% y/y, but were +6.2% above their 5-year seasonal average, signaling adequate nat-gas supplies. As of June 30, gas storage in Europe was 59% full, compared to the 5-year seasonal average of 68% full for this time of year.
Baker Hughes reported Thursday that the number of active US nat-gas drilling rigs in the week ending July 4 fell by -1 to 108 rigs, slightly below the 15-month high of 114 rigs posted on June 6. In the past nine months, the number of gas rigs has risen from the 4-year low of 94 rigs reported in September 2024.
