FINWIRES · TerminalLIVE
FINWIRES

US Natural Gas Update: Prices Rise on Hotter US Forecasts

By

US natural gas futures maintained Wednesday's gains in after-hours trading as hotter-than-expected early-June weather forecasts reinforced expectations for stronger cooling demand and a tighter summer supply-demand balance.

Both the July front-month Henry Hub contract and the continuous contract rose 2.59% to $3.088 per million British thermal units.

The price rise came as updated 6-15 day forecasts trended warmer, encouraging short covering and shifting market attention away from lingering shoulder-season oversupply concerns toward rising summer demand expectations.

"The market is starting to look past shoulder-season looseness toward early summer demand," Gelber & Associates said.

The Commodity Weather Group said above-normal temperatures are expected across the western half of the country during June 1-10.

Aegis Hedging said the warming trend was led by the south-central US, where temperatures across the 15-day outlook increased by 21.6 degrees Fahrenheit. Cooling degree days are expected to soften briefly into the weekend before climbing toward 10 CDDs by the end of the forecast period.

Power-sector consumption reflected stronger cooling-load expectations. Celsius Energy estimated Thursday's power burn at 26.1 Bcf, up 2.6 Bcf from the previous day and 3.1 Bcf above year-ago levels.

Total demand, Barchart said, citing BNEF data, was estimated at 70.1 Bcf/d, up 6.4% from a year ago.

The LNG sector remained steady despite ongoing maintenance work as BNEF data cited by Barchart showed LNG flows to US export terminals at 18.6 Bcf/d on Wednesday, up 200 million cubic feet per day from the prior day and 4.8% higher week on week.

Gelber said dry gas production remains anchored near 110 Bcf/d, while Canadian imports provide a stable secondary supply of near 5 Bcf/d. BNEF data showed Lower-48 dry gas output at 109.8 Bcf/d on Wednesday, down 800 MMcf/d from the previous day but still 1.9% above year-earlier levels.

Attention is now turning to Thursday's US Energy Information Administration storage report. Gelber estimates an injection of 90 Bcf, below the 101 Bcf build recorded in the comparable week last year. It said a smaller-than-year-ago build could reinforce expectations that early summer heat and resilient LNG demand are beginning to tighten balances heading into July.

Related Articles

Commodities

Refiners Slide as US-Iran Peace Hopes Pressure Crack Spreads, TPH Energy Says

Refining equities and product crack spreads declined last week as reports of progress in US-Iran peace negotiations pressured margins and softened sector sentiment, TPH Energy strategists said in a note on Tuesday.Matthew Blair, analyst at TPH Energy, said the refining group fell 1.3%, underperforming the S&P 500's 0.9% gain, with high-beta names leading losses.PBF Energy (PBF) dropped 4.9%, while Phillips 66 (PSX) outperformed the group with a 1.6% rise, making it the lone notable gainer among diversified refiners.TPH said the decline was driven by a sharp compression in refined product cracks. US gasoline cracks fell $12 to $25 per barrel, while US diesel cracks declined $7 to $45/bbl.Regional softness was most pronounced in the Midwest, Midcontinent and Rockies, TPH analysts said, reflecting broad-based margin pressure.International cracks were mixed. Northwest Europe gasoline and diesel eased by $1 and $3/bbl, respectively, while Singapore markets moved against the trend, with gasoline up $3/bbl and diesel rising $5/bbl.Forward curves also reflected the softer tone. The 2026 gasoline strip moved $1 lower, while diesel was unchanged.On the crude side, the Brent-WTI spread narrowed to $3/bbl from $5 previously, reducing a key advantage for US refiners that benefit from discounted domestic crude.Blair said grades, including Mars, Louisiana Light Sweet and Bakken crude strengthened, while Western Canadian Select at Hardisty, Mexico's Maya crude and Alaska North Slope held largely steady.Macro and industry developments added to the mixed backdrop. US regular gasoline prices eased 5 cents to $4.45 per gallon. India raised retail gasoline prices in response to war-related supply dynamics involving Iran.Kuwait's refinery throughput has reportedly fallen by half since the Middle East conflict began, while US jet fuel production has climbed above 2 million barrels per day in recent weeks.On corporate activity, Delek US Holdings (DK) disclosed a $100 million share repurchase authorization from REH. However, despite the recent pullback in refining equities, TPH said most refiners continue to trade above their three-year average forward EBITDA valuation multiples, except for Phillips 66 and Valero Energy (VLO).

$DK$PBF$PSX$VLO
Commodities

US Natural Gas Update: Futures Prices Soften in Choppy Trade

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.

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.