U.S. natgas futures ease from 8-month high ahead of storage report

U.S. natural gas futures eased from an eight-month high as the market
waits for a federal report expected to show a near-normal storage build last week.

That price decline came despite a continued rise in liquefied natural gas (LNG) exports and
forecasts for more hot weather and air conditioning demand through early September than earlier expected.

Analysts said U.S. utilities injected 43 billion cubic feet (bcf) of gas into storage in the week
ended August 14. That compares with an increase of 56 bcf during the same week last year and a five-year (2015-19) average build of 44 bcf.
If correct, the increase would bring stockpiles to 3.375 trillion cubic feet (tcf), 15.1% above the five-year average of 2.933 tcf for this time of year.

Front-month gas futures fell 1.2 cents, or 0.5%, to $2.414 per million British thermal units
at 8:15 a.m. EDT (1215 GMT). On Wednesday, the contract closed at its highest since Dec. 5.
Although U.S., European and Asian gas contracts mostly trade on their own fundamentals, a 56% jump in prices at the Netherlands Title Transfer Facility (TTF) in Europe and a 60% increase at the Japan-Korea Marker (JKM) in Asia so far in August made U.S. LNG more attractive in global markets, which helped pull U.S. gas futures up about 34% this month.

U.S. LNG exports were on track to rise in August for the first time in six months. Pipeline gas
flowing to the plants climbed to a three-month high of 4.4 billion cubic feet per day (bcfd) so far this month from a 21-month low of 3.3 bcfd in July. nL1N2F51D8]

With temperatures expected to remain hot through early September, Refinitiv projected U.S. demand, including exports, will hold around 90.3 bcfd this week and next. That is higher than Refinitiv's forecast on Wednesday.

 
 (Reporting by Scott DiSavino)
  

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