A fall in daily output and predictions of hotter-than-normal weather in late June caused natural gas prices to drop 1.62%, ultimately ending at 242.5. This decline was caused by profit bookings following previous increases. One factor influencing the market dynamics was the recovery of gas flow to LNG export facilities, especially after the reopening of the Freeport LNG plant in Texas.
Still, because of continuing maintenance at many plants, exports are below the high of December 2023. Gas output in the Lower 48 US states decreased somewhat in June, although it is still far less than the record established in December 2023. This is mostly because of well completion delays and a decrease in drilling activity earlier in the year.
Through June 21, warmer-than-average weather is predicted for the Lower 48 states, which will enhance petrol consumption. From 93.7 bcfd this week to 93.1 bcfd the following week, LSEG predicts a small slowdown in petrol demand.
Amidst this, US utilities added 98 billion cubic feet of gas to storage in the week ending May 31, 2024, surpassing market projections and registering the ninth week in a row of seasonal inventory accumulation. With 2,893 Bcf of working gas in storage overall, it is both far greater than it was a year ago and above the five-year average, suggesting a plentiful supply.
