US natural gas futures held onto gains in after-hours trading on Tuesday, recovering from earlier losses as markets reacted to shifting geopolitical signals and steady domestic supply conditions during the low-demand shoulder season.
The front-month Henry Hub contract, along with the continuous contract, rose by 0.78% to $2.71 per million British thermal units.
Price action tracked broader energy markets, with Barchart noting that a rally in crude oil, driven by the ongoing closure of the Strait of Hormuz, prompted short covering in gas futures. That geopolitical backdrop provided upward momentum despite otherwise bearish fundamentals.
Weather forecasts, however, capped gains. The Commodity Weather Group said updated projections turned warmer, with above-average temperatures expected across the US Midwest through Apr. 25.
Gelber & Associates added that its two-week outlook for the Midwest and South Central regions warmed by roughly 20 degrees Fahrenheit compared with prior estimates, though slightly cooler expectations elsewhere offset part of the shift.
Fundamentals continued to point to ample supply. The US Energy Information Administration said working gas in storage across the Lower 48 states is estimated at about 1,890 billion cubic feet at the start of the April-October injection season, roughly 3% above both year-ago levels and the five-year average.
Supply remains robust, with total Lower 48 output at 113.2 billion cubic feet per day, driven primarily by dry gas production of 107.8 Bcf/d and net Canadian imports of 5.4 Bcf/d, according to Gelber & Associates. Demand has been relatively subdued, weighed down by residential and commercial consumption at 19 Bcf/d.
Separate data cited by Barchart, drawing on BNEF figures, showed US gas production at 110.3 Bcf/d on Tuesday, up 2.3% year over year. Demand was estimated at 70.8 Bcf/d, up 4.7% from a year earlier, while liquefied natural gas net flows to export terminals reached 20.0 Bcf/d, a 1.5% increase week over week.