US Natural Gas Prices Climb on Stronger Demand Forecasts
US natural gas prices are climbing near a one-week peak, buoyed by brighter demand forecasts and rising liquefied natural gas (LNG) exports. November futures rose 1.3 cents, or 0.4%, to $3.048 per million British thermal units, setting the stage for the highest close since September 25.
The uptick in prices comes despite mild weather across much of the country. Demand is projected to average 106.2 billion cubic feet per day across the Lower 48 states, including exports, for this week and next. Revisions to these forecasts signal a stronger demand environment as autumn progresses.
LNG exports are a key driver of this demand. Gas flows to US LNG export facilities are expected to increase, with feedgas demand forecast to hit around 17.6 billion cubic feet per day. Meanwhile, production has eased from recent record highs, further tightening the supply-demand balance.
US natural gas output averaged 111.7 billion cubic feet per day in October, down from record levels of 113.3 billion cubic feet per day in August and September. Production is expected to dip further to around 109.3 billion cubic feet per day following a pipeline outage in Kentucky. Despite this, underlying production remains robust, reflecting the industry’s capacity to meet both domestic and export needs.