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US Natural Gas Update: Futures Slide Despite Forecasts of Heatwave, Soaring Power Demand

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US natural gas futures were down on Thursday despite forecasts of a severe heatwave and soaring near-term power demand, ahead of the weekly gas storage report.

Both the front-month Henry Hub contract and the continuous contract fell by 0.96% to $3.189 per million British thermal units.

Almost the entire country is expected to experience above-normal temperatures from July 9 to July 15, according to the National Weather Service.

Like Europe, the US is experiencing a "powerful and a historic Heat Dome," which is expected to result in intense surface heat and soaring humidity, leading major cities like New York to witness temperatures as high as 100 degrees Fahrenheit, according to a report by Severe-Weather EU.

All of this is expected to result in increased space-cooling demand and, thus, higher natural gas-fired power consumption over the coming weeks.

According to Pinebrook Energy Advisors, power generation demand for natural gas, already at 49 billion cubic feet per day, should hit "50 Bcf per day or more tomorrow as cooling load peaks across the Midwest and East."

This, they noted, "should sharply limit storage injections for the week."

US LNG feedgas flows are expected to stay elevated, at 19.32 Bcf on Thursday, compared to the 30-day moving average of 18.50 Bcf, according to the Bloomberg LNG Feedgas Model.

Markets are also awaiting the US Energy Information Administration's weekly natural gas inventory data, with forecasts calling for a net injection of 81 Bcf, compared with 76 Bcf last week and 55 Bcf during the same period last year, according to data compiled by Investing.com.

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