FX.co ★ US Natgas Prices Extend Losses to 5-Week Low

U.S. natural gas futures fell nearly 4% to $3.20 per million British thermal units (MMBtu), marking the lowest level since April 25. This decline extends a loss of more than 12% from the previous week, largely due to diminished short-term demand and a reduction in liquefied natural gas (LNG) exports. Warmer-than-usual weather through the latter part of May is anticipated to decrease heating demand, while mild temperatures simultaneously curtail air conditioning usage, collectively reducing overall consumption. Concurrently, there has been a decrease in gas flows to LNG export terminals due to routine seasonal maintenance, which has alleviated some of the pressure on domestic supplies. On the supply front, the average gas output in the Lower 48 states has declined to 103.6 billion cubic feet per day (bcfd) in May, down from 105.8 bcfd recorded in April. Additionally, the Energy Information Administration (EIA) reported a significantly larger-than-average build in storage, with utilities injecting 110 billion cubic feet (bcf) of gas for the week ending May 9, indicating reduced demands for both heating and cooling.