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U.S. natural gas prices racked up their biggest one-day gain in more than a month on Tuesday, driven largely by forecasts that suggest this week’s EIA storage report could again show a below-average injection that could further narrow an inventory surplus from ~7.5% above normal to possibly just 6% above normal.
The reason for the small injections in recent weeks is largely attributed to a much hotter summer than usual in Texas, which is one of the top U.S. gas consumers, especially during the summer months when air conditioning usage surges, causing higher demand for natural gas to generate electricity.
Front-month Nymex natural gas (NG1:COM) for October delivery closed +5.2% to $2.743/MMBtu, the best settlement value since September and largest one-day dollar and percentage gain since August 9.
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“Overall demand remains elevated and a seasonal low in prices is normally made in September,” BOK Financial said in a research note, noting WTI crude oil’s surge toward $90/bbl may be adding some tailwinds.
The Energy Information Administration said in a report that the U.S. exported more liquefied natural gas than any other country during this year’s H1, averaging 11.6B cf/day, or 4% more than H1 2022.
