US Nat-Gas Prices Soar to One-Month High on Hot Weather Outlook

Natural gas prices surged to a one-month high on Thursday, boosted by forecasts for hotter US weather and a below-average build in weekly storage. The September Nymex natural gas contract closed up +0.065 (+2.29%) on the day.

The Commodity Weather Group predicted above-average temperatures across nearly the entire US from September 1-10, which could increase demand for natural gas to power air-conditioning use. In addition, a below-average build in weekly US natural-gas storage inventories also supported prices. The EIA reported that nat-gas inventories rose by +15 bcf for the week ended August 21, below the five-year average of +33 bcf.

US electricity output in the week ended August 22 rose +6.1% y/y to 100,895 GWh, according to the Edison Electric Institute. Lower-48 state gas demand on Thursday was 80.1 bcf/day (+11.5% y/y), while US (lower-48) dry gas production on Thursday was 112.6 bcf/day (+3.8% y/y).