FX.co ★ US Natgas Prices Fall Ahead EIA Report

U.S. natural gas futures have fallen below $3.30 per MMBtu, prompted by market expectations of another significant inventory build. Analysts project a 115 billion cubic feet (bcf) addition to storage for the week concluding on May 16, markedly higher than the previous year’s 78 bcf and the five-year average of 87 bcf. This increase is attributed to mild weather, which has reduced demand for both heating and cooling. If this projection holds true, total stockpiles would reach 2.37 trillion cubic feet—still 12.5% lower than levels a year ago but 3.7% higher than the five-year average. In addition, LNG export volumes have decreased to 15.1 bcfd in May from 16.0 bcfd in April, due to maintenance activities at the Cameron LNG facility, Cheniere’s Corpus Christi location, and temporary operational issues at Freeport LNG. On the domestic front, output has eased slightly to 103.9 bcfd, down from the record high of 105.8 bcfd in April, partly due to maintenance on crucial pipelines such as Kinder Morgan’s Permian Highway. Looking forward, there is growing anticipation of a heat-induced demand increase in mid-to-late June, which could help stabilize or enhance prices.