FINWIRES · TerminalLIVE
FINWIRES

US Natural Gas Update: Futures Prices Soften in Choppy Trade

By

US natural gas futures extended losses in after-hours trade on Tuesday, though price action in the expiring June contract remained volatile as focus shifted toward July and the next phase of weather-driven demand.

The front-month Henry Hub contract slipped 0.58% to $2.89 per million British thermal units, while the continuous contract fell 0.40% to $3.009/MMBtu.

The June contract, which expires Wednesday, traded as low as $2.878/MMBtu, below Friday's settlement of $2.907, and reached an intraday high of $2.989/MMBtu.

Weather models turned cooler over the weekend, weighing on sentiment. The overall Lower 48 forecast cooled by 6.7 degrees Fahrenheit, according to Aegis Hedging. The firm noted, however, that the cooler revisions were concentrated in the one- to two-week outlook, while temperatures at or above seasonal norms are still expected through mid-June.

"The setup is still defined by a familiar late spring tension, where mild stretches keep balances comfortable, but any meaningful heat building across the South and East can quickly lift power burn and improve sentiment at the front of the curve," Gelber & Associates said in a Tuesday note.

Lower-48 gas demand was estimated at 66.6 billion cubic feet per day on Tuesday, down 2.5 Bcf/d from Friday but 6.8% higher than a year earlier, according to BNEF.

Aegis Hedging said strengthening power-sector demand continued to underpin the market. Power demand rebounded by nearly 6 Bcf/d over the weekend to 36.1 Bcf/d, the firm said. Celsius Energy estimated Monday power burn at 30.8 Bcf, up 0.3 Bcf day-on-day and 2.9 Bcf above year-ago levels.

The seven-day average for May 19-25 stood at 32.3 Bcf/d, up 3.6 Bcf/d from the same period last year.

On the supply side, Lower-48 dry gas production rose to 110.6 Bcf/d on Tuesday, up 500 million cubic feet per day from Friday and 3.1% above year-earlier levels, according to BNEF.

Barchart said some short covering emerged in natural gas futures after stronger LNG export demand pointed to tighter domestic balances. Gas flows to US LNG export terminals rose to 18.4 Bcf/d on Tuesday, up 8.8% week-over-week, according to BNEF data.

Related Articles

Commodities

Gujarat Gas Q1 2026 Volumes Fall Amid Weaker Industrial Demand; CNG Sales Hit Record High

Gujarat Gas reported Q1 2026 earnings on Tuesday, with total volumes of 8.88 million metric standard cubic meters per day in Q1 2026, down from 10.98 mmscmd reported in the same period last year.Total Piped Natural Gas volumes stood at 5.55 mmscmd.Industrial PNG volumes were also down to 4.71 mmscmd from 7.25 mmscmd in Q1 2025.Domestic PNG volumes edged up to 0.69 mmscmd, compared with 0.62 mmscmd recorded a year ago.Commercial PNG volumes largely held steady, inching up to 0.14 mmscmd from 0.13 mmscmd a year ago.Compressed Natural Gas volumes rose in the quarter to 3.33 mmscmd from 2.98 mmscmd in the same period a year earlier.Gujarat Gas reported the highest-ever CNG volumes of 3.33 mmscmd in Q1 2026, marking a 12% increase compared with Q1 2025 on the back of investments in CNG station infrastructure.

Commodities

US Biofuels Update: Biofuels Feedstock Futures Trade Mixed on Favorable Crop Weather

Biofuels feedstock futures closed mixed on Tuesday, with the soybean market pressured from favorable planting and growing weather.The Chicago Board of Trade July soybean futures contract closed 0.88% lower at $11.86 per bushel, while CBOT July soybean oil futures contract settled 0.51% higher at 74.36 cents per pound.The Nymex July ethanol futures contract settled 1.59% lower on Tuesday at $2.02 per gallon.Rhett Montgomery, a DTN analyst, said wet weather outlooks continue to weigh on the row-crop markets."The soybean market faced the same weather challenges that weighed on corn futures to begin the week, trading lower for the fourth time in the past five sessions on the July contract," Montgomery said.He added that in the product markets, meal futures turned lower after an exceptionally strong session to close last week, while oil futures eventually turned higher on Tuesday, bolstered by a reversal from daily lows in crude and diesel futures.On Tuesday, the US Department of Agriculture's Weekly Export Inspection Report showed that soybean bookings totaled 21 million bushels for the week ending May 21.Total inspections for 2025-2026 are now at 1.291 billion bushels, down 21% from the previous year. USDA is estimating soybean exports to total 1.530 bb in 2025-26, down 19% from the previous year.Soybean inspections are running behind USDA's estimated pace, even as its soybean ending stocks estimate is 20% larger than the previous five-year average.For the week ending May 24, USDA reports that 79% of the US soybean crop is planted, up 12% from the previous week and 7% ahead of the previous five-year average for mid-May. Also, 49% of the crop has emerged, well ahead of the five-year average. Illinois and Iowa are 84% and 90% planted.

Commodities

China's Weak Crude Demand Helps Balance Global Oil Market, Kpler Says

China's seaborne crude imports dropped 4.7 million barrels per day from pre-Iran conflict levels through May, Kpler said in a Tuesday note.Kpler said weaker household demand and slowing industrial activity increased pressure on China's energy sector as the closure of the Strait of Hormuz neared the three-month mark.Real retail sales declined 1% over the year in April after rising 1.6% in Q1, while industrial production growth slowed to 4.1% from a 6% first-quarter average, the note said.Despite weaker domestic demand, Chinese exports climbed nearly 14% over the year in April after rising 14.5% during the first quarter, reflecting China's continued dependence on overseas markets.Kpler said higher energy prices and supply disruptions remain key reasons China would prefer the Iran conflict to end and Strait of Hormuz flows to resume normally.China's net exports narrowed to $85 billion in April, down $11 billion from a year earlier, though Kpler said higher semiconductor imports tied to artificial intelligence infrastructure drove much of the decline.Kpler expects China's goods trade surplus to remain near a record $1.2 trillion this year, warning that the narrower trade surplus does not indicate a shift toward consumption-led economic growth.Chinese seaborne crude arrivals are tracking near 7 million barrels per day in May, down 1.4 million barrels per day from April levels, according to Kpler estimates.Kpler projected Chinese refinery runs at 13.4 million barrels per day in May, down 2.3 million barrels per day from levels seen before the Iran conflict disrupted regional oil flows.China is helping to balance the global oil market by limiting crude imports even as fuel exports remain weak, Kpler said.Jet fuel, diesel and gasoline exports averaged only 126,000 barrels per day in May, down from 217,000 b/d in April and 625,000 b/d before the Iran conflict, according to the note.