FX.co ★ US Natgas Prices Fall to 3-Month Low

U.S. natural gas futures have declined to $3.07 per million British thermal units (MMBtu), reaching their lowest level since April 22. This drop can be attributed to unexpectedly mild summer temperatures paired with sustained robust production, which have jointly exerted downward pressure on prices throughout July. Weather predictions anticipate less intense heat across North America, diminishing the demand for cooling and, consequently, reducing the consumption of gas for power generation. Concurrently, production levels have remained elevated, with output in the Lower 48 states averaging at 107.2 billion cubic feet per day in July, surpassing June’s previous high of 106.4 billion cubic feet per day. Current inventory levels are approximately 6% above the seasonal average, supporting the perception of an oversupplied market. On the export side, natural gas flows to the eight major U.S. LNG export facilities have increased to 15.8 billion cubic feet per day in July due to several terminals resuming operations after maintenance and outages.