FX.co ★ US Natgas Prices Fall Further from 11-Week High

U.S. natural gas futures have declined towards $3.6/MMBtu, pulling back from the previous week’s peak of $4.09—an 11-week high. This decrease is attributed to increasing production levels and forecasts indicating a reduction in the heat wave contributing to the price pressure. Although a recent spell of extreme heat in the Eastern United States had driven up both energy demand and prices, meteorologists anticipate that the above-normal temperatures will subside by early July. According to LSEG, the average natural gas output in the Lower 48 states increased to 105.5 billion cubic feet per day (bcfd) in June, up from 105.2 bcfd in May; however, this remains below March's peak of 106.3 bcfd due to prior maintenance activities. Additionally, gas deliveries to the eight primary U.S. liquefied natural gas (LNG) export facilities decreased to 14.1 bcfd in June from 15.0 bcfd in May, primarily owing to regular seasonal maintenance. Market participants remain cautious as a potential ceasefire between Israel and Iran has reduced tensions in the energy-abundant Middle East.