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US Natural Gas Update: Futures Rise Over 3% Amid Rising Temperatures, Bullish Storage Expectations

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US natural gas futures were up over 3% on Thursday, on expectations of a smaller storage build, above-normal temperatures across the country, and a drop in output.

The front-month Henry Hub contract and the continuous contract both rose 3.73% to $3.333 per million British thermal units.

Markets are awaiting the US Energy Information Administration's Weekly Natural Gas Storage Report, scheduled for later in the day, with forecasts expecting a 99 billion cubic feet net injection into storage.

This is above the prior week's 92 Bcf injection, but falls short of last year's 119 Bcf and the five-year average of 101 Bcf for this period, according to NRG Energy.

US natural gas output has dropped to 106 Bcf per day on Wednesday, from 108 Bcf/d earlier in the week, amid declines in northeast and midcom output, further adding to the fundamental bullishness.

The whole of the country is set to see above-normal temperatures from June 11 to June 17, according to the National Weather Service.

According to Gary Cunningham of Tradition Energy, such "temperatures are expected to add to power sector gas demands and firm up the fundamentals for the remainder of summer."

Meanwhile, LNG feedgas flows turned bearish after briefly slipping to 16.3 Bcf/d so far in June, having averaged 17.1 Bcf/d in May, as seasonal maintenance across leading LNG facilities continued to weigh on demand, according to Trading Economics.

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