US natural gas prices rose above $2.90/MMBtu, the highest level in five weeks, after the latest EIA report showed a smaller-than-expected storage build. Utilities injected just 15 billion cubic feet of gas into storage last week, below the 20 bcf consensus forecast and well under the five-year average of 33 bcf for the same period.
Price support also came from weather forecasts, with above-normal temperatures expected across much of the eastern United States from August 31 through September 4. The sustained heat is likely to keep air-conditioning use elevated, bolstering gas demand from power generators.
Even so, robust domestic production continues to cap further price gains. Output in the Lower 48 states averaged a record 111.4 bcfd in August, up from 110.7 bcfd in July. At the same time, average gas flows to the nine major US LNG export terminals edged down slightly to 17.1 bcfd so far this month, from 17.2 bcfd in July, though there are early signs that LNG demand is beginning to recover.
