Natgas Prices Hold Steady Amid Warm Weather and Record Production

US natural gas prices have been holding steady at $2.91/MMBtu, a five-week high, due to several factors. The Energy Information Administration (EIA) reported that energy firms added only 15 Bcf of gas to storage for the week ended August 21, which is lower than the forecasted 20 Bcf and the five-year average of 33 Bcf.

The continuation of warm weather across the Southwest through this weekend, as well as forecasts of record-high temperatures in that region, have contributed to elevated cooling demand. The Commodity Weather Group also predicts above-average temperatures nationwide from September 1-10.

However, domestic production is capping further price gains, with output in the Lower 48 states averaging a record 111.4 bcfd so far in August, up from 110.7 bcfd in July. Meanwhile, LNG export facilities have seen a slight decrease in average gas flows to 17.1 bcfd from 17.2 bcfd in July.