U.S. Natural Gas Prices Rise to $2.79 Amid Hotter Forecasts

U.S. natural gas prices rose more than 2% for a second consecutive week to around $2.79 per million British thermal units, while Nymex futures were up 1.6% at $2.777/mmBtu at 1001 ET. Hotter near-term forecasts supported prices, with NatGasWeather.com describing the next 15 days as solidly bullish and daily national cooling degree days, a measure of air-conditioning demand, expected to remain above normal. Gains were limited by comfortable storage levels and abundant supply. The U.S. Energy Information Administration reported that utilities added 16 billion cubic feet of gas to storage in the week ended Aug. 14, taking inventories to 3,169 Bcf, below the 19 Bcf injection a year earlier and the five-year average of 29 Bcf, but still well above seasonal norms. Record production and relatively mild weather earlier in the year have supported inventories, while average gas flows to the nine major U.S. LNG export facilities held at 17.2 bcfd in August, just below June's record of 17.4 bcfd. The next EIA report is expected to show another smaller-than-normal build, reflecting recent heat and lighter wind-energy generation. Forecasts for warmer-than-normal temperatures through September 3 could further increase gas demand from power generators.

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