Nat-Gas Prices Plummet on Surging US Inventories

Natural gas prices fell on Friday due to adequate US inventories, according to the latest data from the Energy Information Administration (EIA). The EIA reported a +40 bcf increase in US natural gas inventories for the week ended September 4, above expectations of +34 bcf. This is despite forecasts of warm US weather that could boost natural gas demand from electricity providers to meet air conditioning use.

The Commodity Weather Group said above-average temperatures are expected across the South and Southeast through September 20. However, the market is expecting a 'Super El Niño' to bring warmer-than-normal temperatures to the Northern Hemisphere this fall and winter, reducing heating demand for natural gas.

US (lower-48) dry gas production on Friday was 113.8 bcf/day (+4.4% y/y), according to BNEF. Lower-48 state gas demand on Friday was 75.8 bcf/day (+7.5% y/y), according to BNEF.