US natural gas futures fell more than 5% to a near 11-week low on Monday on forecasts of milder weather and lower demand for the next two weeks. Front-month gas futures dropped 27.6 cents (5.4%) to $4.789 per MMBtu, their lowest settlement since September 7. Trading sources added that prices were also weighed down by near-record US gas production, healthy inventories, and a drop in European gas futures.
The average gas production in the US Lower 48 states stood at 96.1 Bcfd since the start of November, up from 94.1 Bcfd in October and compared to a monthly record of 95.4 Bcfd seen in November 2019. US gas demand, including exports, is expected to increase from 111.4 Bcfd this week to 114.1 Bcfd next week on increased heating demand. Nevertheless, the recent outlook was lower than the projection last week.
Feedgas flows to the main LNG export terminals in the US averaged 11.2 Bcfd so far this month, up from 10.5 Bcfd last month. That compares to a monthly record of 11.5 Bcfd seen in April 2021. The recent increase was attributed to the start-up of the sixth liquefaction train at Cheniere Energy’s Sabine Pass LNG facility in Louisiana.
