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US Natural Gas Update: Futures Rise Nearly 3% Amid Bullish Near-Term Weather, Drop in Output

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US natural gas futures rallied on Wednesday, recovering from a one-week low after near-term weather forecasts turned bullish, even as gas output dipped.

The front-month Henry Hub price edged up by 2.60% to $2.842 per million British thermal units, while the continuous contract gained 2.16% to $2.882/MMBtu.

Almost the whole of the country, barring parts of the Northwest, is expected to see above-normal temperatures from September 02 through September 08, according to the National Weather Service, keeping space cooling demand and gas-fired power burn elevated over the next few weeks.

This comes amid a 1 billion cubic feet per day dip in domestic gas output, to 108.4 Bcf/d, according to a report by NRG Energy.

Meanwhile, gas demand softened slightly by 0.7 Bcf/d to 86.0 Bcf/d, primarily due to milder conditions across parts of the Midcontinent and Texas.

US LNG export feedgas flows were expected to witness an uptick on Wednesday, at 18.30 Bcf/d, ahead of the 30-day moving average of 17.82 Bcf/d, according to the Bloomberg LNG Feedgas Model.

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