US natural gas prices climbed to about $2.79 per million British thermal units on Friday, rising more than 2% for a second straight week as traders weighed expectations of prolonged summer heat against ample supply.
The latest EIA report showed that US utilities injected just 16 billion cubic feet of natural gas into storage last week, below both the 19 bcf added during the same week a year ago and the five-year average build of 29 bcf. Even with this smaller injection, inventories remain comfortably above seasonal norms, underpinned by record production and relatively mild weather earlier in the year. Robust output has therefore helped offset the impact of strong summer demand on storage levels.
At the same time, average gas flows to the nine major US LNG export facilities held at 17.2 bcfd in August, only slightly under June’s record of 17.4 bcfd. Looking ahead, forecasts for above-normal temperatures through September 3 are expected to lift gas consumption from power generators, potentially providing additional support to prices.
