HomeNewsU.S. natgas prices climb 2% to 3-week high on lower output, higher demand

U.S. natgas prices climb 2% to 3-week high on lower output, higher demand

5/2/2025
  • S. LNG export feedgas hit record high in April
  • S. gas output hit record high in April
  • S. gas storage about 1% over 5-yr normal

U.S. natural gas futures climbed about 2% to a three-week high on Friday on a drop in output over recent days and forecasts for more demand this week than previously expected.

Gas futures for June delivery on the New York Mercantile Exchange rose 5.7 cents, or 1.6%, to $3.536 per million British thermal units (MMBtu), putting the contract on track for its highest close since April 10.

For the week, the front-month was on track to rise about 21% after dropping 29% over the prior four weeks.

Analysts noted mild weather expected to last through mid-May should keep heating and cooling demand low, allowing utilities to keep injecting more gas into storage than normal for this time of year.

Gas stockpiles were around 1% above the 5-yr normal. Gas stockpiles had been below normal from mid-January through late April after utilities pulled a record 1.013 Bft3 of gas from storage to keep homes and businesses warm during extreme cold weather this winter.

Some analysts said mild weather and record output this spring could allow energy firms to add record amounts of gas into storage in May, breaking the all-time monthly injection high of 494 Bft3 set in May 2015.

Supply and demand. Financial firm LSEG said average gas output in the Lower 48 U.S. states fell to 103.0 Bft3d so far in May, down from a monthly record of 105.8 Bft3d in April.

On a daily basis, gas output was on track to drop by 2.8 Bft3d over the last five days to a preliminary two-month low of 102.6 Bft3d on Friday. That, however, is a smaller daily decline than LSEG forecast on Thursday. Analysts have noted that preliminary data - especially for the first day of the month - is often revised later in the day.

Meteorologists projected temperatures in the Lower 48 states would remain mostly warmer than normal through May 17.

LSEG forecast average gas demand in the Lower 48, including exports, will slide from 98.8 Bft3d this week to 96.0 Bft3d next week and 95.5 Bft3d in two weeks. The forecast for this week was higher than LSEG's outlook on Thursday.

The average amount of gas flowing to the eight big liquefied natural gas export plants operating in the U.S. fell to 15.5 Bft3d so far in May, down from a monthly record of 16 Bft3d in April on rising flows to Venture Global's 3.2-Bft3d Plaquemines export plant under construction in Louisiana.

The LNG feedgas decline so far this month was mostly due to a drop in flows to Cameron LNG's 2-Bft3d export plant in Louisiana to 1.5 Bft3d for a second day in a row on Friday, down from an average of 2.2 Bft3d over the prior seven days.

Officials at Cameron LNG were not immediately available for comment on the feedgas reduction. The company, however, has told customers that it will conduct maintenance on a pipeline that supplies gas to the plant next week, which will reduce flows on the pipe.

The U.S. became the world's biggest LNG supplier in 2023, surpassing Australia and Qatar, as surging global prices fed demand for more exports, due in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

Gas was trading around $11 per MMBtu at both the Dutch Title Transfer Facility benchmark in Europe and the Japan Korea Marker benchmark in Asia.

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