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US Natural Gas Update: Futures Edge Higher on Bullish Weather Forecasts, Drop in Output

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US natural gas futures edged higher on Monday, amid bullish near-term weather forecasts and a drop in gas output over the weekend.

Both the front-month Henry Hub contract and the continuous contract gained 0.33% to $2.756 per million British thermal units.

Weather forecasts are pointing to another major heat dome forming over the US, with afternoon temperatures across the Southwest and central Plains expected to reach between 105 and 110 degrees Fahrenheit, according to a report by Severe-Weather EU. This is expected to keep cooling demand, along with gas-fired power burn, elevated in the near-term.

Meanwhile, gas output, which had touched 109.4 billion cubic feet per day on Friday, dropped back to 108.5 Bcf/d over the weekend, according to NRG Energy, further supporting prices.

LNG export feedgas flows are expected to edge higher on Monday, at 18.05 Bcf, which is above the 30-day moving average at 17.95 Bcf, according to the Bloomberg LNG Feedgas Model, while still remaining below the recent historic highs.

This is primarily due to the Freeport LNG facility in Texas undergoing planned maintenance, which began on July 10 and is expected to last until late August.

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US Natural Gas Update: Futures Edge Higher on Bullish Weather Forecasts, Drop in Output | FINWIRES