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US Natural Gas Update: Futures Gain Ahead of Storage Data on Weather Forecast Shift

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US natural gas futures maintained earlier gains in after-hours trade on Wednesday as warmer weather forecasts and expectations for stronger cooling demand offset lingering concerns about ample inventories.

The front-month Henry Hub natural gas and the continuous futures contract both climbed 0.88% to $2.868 per million British thermal units.

According to Barchart, natural gas prices gained support after forecasts shifted toward above-normal temperatures across key regions of the US.

Above-average temperatures are expected across the Midwest and Southwest through May 17, potentially boosting demand from electricity providers for air conditioning, Barhcart said, citing information from the Commodity Weather Group.

A decline in natural gas output also supported higher futures prices on Wednesday, Natural Gas Intelligence said Wednesday.

US gas production averaged 109.8 billion cubic feet per day on Wednesday, up 3.1% from a year earlier, according to BNEF data cited by Barchart.

Lower-48 gas demand rose 6.0% year-over-year to 67.8 Bcf/d, while estimated LNG net flows to US export terminals slipped 1.9% week-over-week to 17.3 bcf/day, data showed.

Meanwhile, traders awaited the US Energy Information Administration's weekly storage report, due on Thursday.

Analysts surveyed by The Wall Street Journal expect an 87 Bcf injection for the latest week, which would leave inventories 142 Bcf above the 2021-2025 average, compared with the prior week's surplus of 139 Bcf.

The WSJ cited EBW Analytics as saying two more "supportive" EIA storage reports are likely before triple-digit injections return by the end of May.

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