US natural gas futures rose to $3.17 per MMBtu on Tuesday after two straight sessions of declines, supported by near-record LNG export volumes that lifted demand. Average gas flows to the eight major US LNG export terminals have increased to 18.5 bcfd so far in February from 17.8 bcfd in January, matching the monthly record set in December and tightening domestic supply.
Even so, prices remain near their lowest level since January 16, as forecasts indicate warmer-than-normal weather and reduced heating demand over the next two weeks. Output has also climbed, with production in the Lower 48 rising to about 107.4 bcfd so far in February, up from 106.3 bcfd in January.
The recent Arctic cold snap triggered a record 360 bcf storage withdrawal, leaving inventories roughly 1% below the seasonal norm. Continued cold in the near term is expected to deepen that shortfall to around 6% below average. However, milder temperatures projected through late February could narrow the storage deficit by March.
