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Oversupply Pushes US Natural Gas Weakness Further

NATGAS
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US nat gas prices faced further weakness Friday on the back of a drop in feedgas flows to Freeport LNG and a lingering oversupply towards the end of the winter heating season as well as warmer forecasts.

  • US Natgas MAY 24 down -1.5% at 1.61$/mmbtu
  • Flows to the US Freeport LNG terminal are estimated at 0.08bcf/d on Friday, compared with 0.02bcf/d according to Bloomberg, suggesting all three trains are still offline.
  • US gas remains pressed by heavy supply levels against a weak demand backdrop but LSEG figures show supply dipping - LSEG said gas output in the Lower 48 U.S. states had fallen to an average of 96.9 billion cubic feet per day (bcfd) in April from 100.8 bcfd in March.
  • LSEG forecasts gas demand in the Lower 48 states, including exports, to fall to 91.7 bcfd next week, from 92.2 bcfd this week.
  • High oil prices are pressing US oil drillers to produce more barrels, pulling more gas as a byproduct.
  • The latest 6-10 weather forecasts is broadly unchanged on the day with most of the US seeing above-normal temperatures, with below-average temperatures on parts of the US West Coast.
  • US gas suppliers pin hopes on higher air conditioning demand to prompt higher gas consumption and quell some of the oversupply.
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US nat gas prices faced further weakness Friday on the back of a drop in feedgas flows to Freeport LNG and a lingering oversupply towards the end of the winter heating season as well as warmer forecasts.

  • US Natgas MAY 24 down -1.5% at 1.61$/mmbtu
  • Flows to the US Freeport LNG terminal are estimated at 0.08bcf/d on Friday, compared with 0.02bcf/d according to Bloomberg, suggesting all three trains are still offline.
  • US gas remains pressed by heavy supply levels against a weak demand backdrop but LSEG figures show supply dipping - LSEG said gas output in the Lower 48 U.S. states had fallen to an average of 96.9 billion cubic feet per day (bcfd) in April from 100.8 bcfd in March.
  • LSEG forecasts gas demand in the Lower 48 states, including exports, to fall to 91.7 bcfd next week, from 92.2 bcfd this week.
  • High oil prices are pressing US oil drillers to produce more barrels, pulling more gas as a byproduct.
  • The latest 6-10 weather forecasts is broadly unchanged on the day with most of the US seeing above-normal temperatures, with below-average temperatures on parts of the US West Coast.
  • US gas suppliers pin hopes on higher air conditioning demand to prompt higher gas consumption and quell some of the oversupply.