-- US natural gas futures rose in midday trade on Monday, supported by declining production amid abundant supply and soft shoulder-season demand.
Both the front-month Henry Hub contract and the continuous contract rose 3.20% to $2.87 per million British thermal units.
US dry gas production has eased from recent highs with output peaking near 110 billion cubic feet per day in February, according to the Energy Information Administration.
Trading Economics said its data indicated production has since slipped roughly 2 Bcf/d over the past five days to a preliminary 12-week low of 107.6 Bcf/d. The decline reflects voluntary curtailments by major producers as sustained low prices pressure output economics.
The softer production profile is feeding through into storage dynamics. The EIA reported a 79 Bcf injection for the week ended Apr. 24, broadly aligned with expectations of an 80 Bcf build. However, the increase was smaller than the prior week's 103 Bcf and well below the 105 Bcf build recorded in the same week a year earlier.
Demand signals remain mixed. Weather models point to lingering colder-than-normal conditions in the eastern US through May 11, before a transition to warmer temperatures. Power sector gas demand has eased in recent days, falling to 26.2 Bcf/d from a stronger 33.0 Bcf/d reported last Wednesday.
On the LNG side, feedgas flows have moderated slightly. NRG reported flows at 17.3 Bcf/d as of May 4. Trading Economics data showed April averaged 18.8 Bcf/d, up from 18.6 Bcf/d in March and above February's prior record monthly average of 18.7 Bcf/d.