US Natural Gas Futures Surge on Warm Weather Forecasts
US natural gas futures rose on Thursday to hover near a one-month high hit in the last session. The gain was driven by forecasts for warmer-than-normal weather through early September, which boosted expectations for cooling demand.
The front-month gas futures contract for September delivery on the New York Mercantile Exchange rose 5.1 cents or 1.8% to $2.893 per million British thermal units. This is near its highest level since July 24, when it reached $2.911 per mmBtu.
Phil Flynn, a senior market analyst for Price Futures Group, attributed the increase in natural gas futures to a 'heat rally' and the return of the LNG export market to levels seen in July after maintenance and reduced flows.
The US Energy Information Administration's weekly gas storage report is due later today at 10:30 a.m. EDT. The report could be the next major driver for prices, with a larger-than-expected inventory build potentially pulling futures back toward the mid-$2.60 range.