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Natural Gas ($GAS) Commodity Forecast: Down 5.0% Today

Morpher AI identified a bearish signal. The commodity price may continue to fall based on the momentum of the negative news.

What is Natural Gas?

Natural Gas is a widely used commodity for heating and electricity generation, with its prices highly influenced by factors such as production levels, demand forecasts, and storage inventories. Today, the market experienced a bearish movement with prices declining significantly.

Why is Natural Gas going down?

GAS commodity is down 5.0% on Jul 2, 2024 13:41

  • Natural gas prices fell to a multi-week low due to increased production levels by key companies, leading to a surplus in storage and lower demand forecasts.
  • Despite a heatwave impacting the US, gas prices declined as analysts highlighted high inventories and rising production. Gas output in the Lower 48 states averaged 98.8 bcfd in June.
  • Gas storage levels increased slightly according to the latest report, now 20.6% above the seasonal average, contributing to the downward pressure on prices.
  • The bearish movement in natural gas prices can be attributed to increased production, lower demand forecasts, and surplus gas in storage, despite the ongoing heatwave in the US.

GAS Price Chart

GAS News

US Natgas Prices Drop to 6-Week Low

US natural gas futures fell about 5% to a six-week low to $2.47/MMBtu on Monday, influenced by increased production, lower demand forecasts, and a surplus of gas in storage. Despite an ongoing heat wave, gas prices declined as analysts highlighted high inventories and rising production. Gas output in the Lower 48 U.S. states averaged 98.8 bcfd in June, up from May's 25-month low of 98.8 bcfd. Gas flows to major US LNG export plants dropped in June due to maintenance at several facilities. Feedgas to the Freeport LNG plant increased after a significant drop, with operations impacted by compressor system issues. Texas's ERCOT noted that peak demand in June nearly set a record, and July demand is expected to break records due to heightened air conditioning use. Hurricane Beryl is expected to affect Mexico's Yucatan Peninsula and the Bay of Campeche, impacting oil production.

US Natgas Prices Fall to 5-Week Low

US natural gas futures fell to $2.5/MMBtu, the lowest in five weeks, due to increased production after companies like EQT and Chesapeake Energy ramped up drilling. In June, gas output in the Lower 48 states rose to 98.6 bcfd from a 25-month low of 98.1 bcfd in May. On the demand side, hotter-than-normal weather is projected through at least July 12, maintaining high gas consumption for air conditioning. Meanwhile, the most recent EIA report showed a 52 billion cubic feet increase in natural gas storage by US utilities in the week ending June 21, pushing levels to 20.6% above the seasonal average.

Natural gas Hits 4-week Low

Natural gas decreased to a 4-week low of 2.57 USD/MMBtu. Over the past 4 weeks, Natural gas lost 6.59%, and in the last 12 months, it decreased 4.73%.

US Natgas Prices Steady after EIA Report

US natural gas futures fluctuated around $2.75/MMBtu after the EIA's storage build report. The data showed US utilities added 52 billion cubic feet of natural gas into storage last week, slightly below the expected 53 bcf build. Gas in storage is now 20.6% above the seasonal norm. Despite this, natural gas prices are headed for a third consecutive week of declines due to increased output, as higher prices in recent weeks encouraged producers like EQT and Chesapeake Energy to resume drilling. Gas output in the Lower 48 states averaged 98.6 billion cubic feet per day (bcfd) in June, up from a 25-month low of 98.1 bcfd in May. On the demand side, hotter-than-normal weather is projected through at least July 12, maintaining high gas consumption for air conditioning.

US Natgas Falls 2% On Rising Output, Lower Demand Forecasts

U.S. natural gas futures dropped 2% to around $2.72/MMBtu due to a modest increase in output and lower-than-expected demand forecasts for the next two weeks, despite a severe heatwave hitting much of the country. LSEG reported that gas output in the Lower 48 U.S. states rose to an average of 98.5 bcfd in June, up from a 25-month low of 98.1 bcfd in May. The financial firm predicted a decrease in average gas demand, including exports, from 103.0 bcfd this week to 100.3 bcfd next week. So far in 2024, U.S. gas production remained down around 8% as energy firms, including EQT and Chesapeake, delayed well completions and cut drilling activities due to prices dropping to 3-1/2-year lows in February and March.

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Natural Gas Price History

26.05.2024 - GAS Commodity was down 5.0%

  • Natural Gas prices experienced a bearish movement today due to rising output and lower demand forecasts.
  • The increase in gas production in the US, despite a heatwave, coupled with reduced demand expectations for the upcoming weeks, led to the decline in prices.
  • The ongoing maintenance at major LNG export facilities in Louisiana also contributed to the market movement, limiting the capacity for gas flows.
  • The market sentiment was further impacted by the delay in well completions and reduced drilling activities by energy firms following previous lows in gas prices earlier in the year.

24.05.2024 - GAS Commodity was up 5.3%

  • Natural gas futures rose by about 4% to $2.8/MMBtu due to forecasts of hotter weather and increased cooling demand, leading to a bullish movement in the market.
  • The price hike was supported by predictions of above-normal temperatures across the Lower 48 states, driving up the use of gas-powered generators for air conditioning purposes.
  • Despite increased output by producers to meet the rising demand, ongoing maintenance at major LNG export facilities in Louisiana limited gas flows, contributing to the bullish momentum in prices.
  • The market movement was also influenced by the anticipation of record early summer heat in the Northeast and increased demand from the power sector, indicating a potential demand spike and supporting the upward trajectory of natural gas prices.

20.05.2024 - GAS Commodity was down 5.3%

  • Natural gas prices experienced a bearish movement today due to increased production levels in the US, leading to a surplus in supply.
  • Despite the recent bearish trend, a temporary uptick in prices was observed as extreme heat across the country drove up demand from the power sector, hinting at the volatility of the market influenced by weather patterns.
  • The ongoing maintenance at major LNG export terminals in Louisiana also played a role in limiting gas flows, impacting the overall market sentiment.
  • The market seems to be reacting sensitively to both supply-side factors like increased production and demand-side factors such as weather forecasts, showcasing the intricate balance that dictates natural gas prices.

18.05.2024 - GAS Commodity was up 5.0%

  • The bullish movement in Natural Gas prices today can be attributed to the extreme heat spreading across the US, leading to increased demand from the power sector and anticipation of record early summer heat in the Northeast.
  • The upcoming hot period from June 19 to July 2, as per weather models, is supporting the prices, while a slight cooling in Texas due to tropical rains may have also impacted the market sentiment.
  • The recent federal report showing a weekly storage build and US gas stockpiles being above their 5-year average might have initially caused some bearish pressure, but the revised forecast by the US Energy Information Administration, predicting a decline in production and higher prices in 2024, could have reassured investors and contributed to the bullish movement.

11.05.2024 - GAS Commodity was up 5.6%

  • Natural gas futures surpassed $3/MMBtu for the first time since November, driven by updated weather forecasts predicting increased electricity demand for air conditioning amid hotter temperatures.
  • The surge in prices is also attributed to producers cutting drilling budgets and reducing output earlier in the year, leading to a decrease in the surplus from the warmer-than-usual winter and alleviating concerns about storage capacity.
  • Expectations of increased cooling demand due to warm weather forecasts for June, particularly in the Midwest and East regions, fueled market optimism and contributed to the bullish movement in natural gas prices.
  • Despite a larger-than-expected storage build reported by the EIA, which showed US gas stockpiles 25.1% above the 5-year average, natural gas prices have risen over 7% this week due to a recent drop in output and forecasts for hotter-than-normal weather later in June.

07.05.2024 - GAS Commodity was up 5.2%

  • Natural gas prices surged over 12% this week to $2.9/MMBtu, driven by expectations of increased cooling demand due to warm weather forecasts for June.
  • Despite a bigger-than-expected storage build reported, prices pared gains to $2.8/MMBtu, as US utilities added more gas into storage, above market expectations.
  • The recent surge in natural gas prices was fueled by a drop in output, forecasts for hotter-than-normal weather, and increased gas flow to LNG export facilities.
  • Overall, the bullish movement in natural gas prices can be attributed to a combination of supply constraints, weather forecasts, and demand expectations, despite concerns about oversupply and high stockpile levels.

07.05.2024 - GAS Commodity was up 5.1%

  • Despite a larger-than-expected storage build, natural gas prices surged over 7% this week due to a recent drop in output and forecasts for hotter-than-normal weather later in June.
  • The return of a LNG plant in Texas and increased gas flow to LNG export facilities contributed to the price increase, despite concerns about oversupply and drillers extracting more gas.
  • With US gas production down about 9% in 2024, energy firms delaying well completions and reducing drilling earlier in the year have impacted the market positively.
  • Meteorologists predicting warmer-than-usual weather until at least June 7 have also supported the bullish movement in natural gas prices.

05.05.2024 - GAS Commodity was up 5.2%

  • Natural gas prices surged by 5% to $2.7153 USD/MMBtu today, showing a bullish movement.
  • The recent increase in prices can be attributed to a 30% surge in May, driven by heightened gas flow to LNG export facilities, particularly the reopening of the Freeport LNG plant in Texas.
  • Despite the recent gains, concerns about oversupply persist as drillers have ramped up gas extraction, leading to a rise in gas stockpiles above seasonal averages.
  • Meteorologists forecasting warmer-than-usual weather until early June could further impact natural gas prices in the coming days, as weather patterns often influence demand for heating and cooling.

04.05.2024 - GAS Commodity was up 5.3%

  • Natural gas prices surged recently due to increased gas flow to LNG export facilities. This increase was notably driven by the reopening of the Freeport LNG plant in Texas, pushing prices near $2.7/MMBtu.
  • Concerns about oversupply emerged as some drillers escalated extraction levels. This led to a subsequent drop in prices below $2.6/MMBtu.
  • The market saw a significant impact from data showing a notable increase in natural gas storage levels in the US, surpassing expectations and exceeding the stockpiles from the previous year.
  • Meteorological forecasts predicting warmer-than-usual weather contributed to a bearish sentiment, suggesting potential lower demand for natural gas in the upcoming period.

29.04.2024 - GAS Commodity was up 13.3%

  • Natural gas prices increased by 5.03% to $2.8054/MMBtu.
  • The market movement can be attributed to a combination of factors, including a decrease in output, lower-than-expected storage build, and rising gas flows to major US LNG export plants.
  • Despite the recent increase, natural gas prices have been volatile due to oversupply concerns, increased output by drillers in response to higher prices, and stockpiles being significantly above the 5-year average.
  • Looking ahead, meteorologists forecasting warmer than usual temperatures may impact natural gas demand for cooling purposes, potentially influencing future market movements.

24.04.2024 - GAS Commodity was down 8.0%

  • Natural gas prices dropped over 5% to below $2.7/MMBtu.
  • The market movement can be attributed to oversupply concerns and increased output levels.
  • Drillers responding to higher prices by ramping up production also influenced the bearish movement.
  • The return of the Freeport LNG plant in Texas and rising gas flows to major US LNG export plants added to the downward pressure on prices.
  • Gas stockpiles are significantly above the 5-year average, signaling a bearish outlook for natural gas in the near term.

24.04.2024 - GAS Commodity was down 5.0%

  • Natural gas prices dropped by over 5% due to increased daily output and a storage build, leading to concerns about oversupply in the market.
  • The return of a LNG plant in Texas and rising gas flows to major US LNG export facilities contributed to the downward pressure on prices.
  • Despite a slight decrease in US gas production, the overall increase in output and storage levels, combined with warmer weather forecasts driving up consumption, led traders to cash in profits, causing a retreat from recent highs.
  • The bankruptcy of a contractor involved in the construction of an LNG export plant raised fears of delays and reduced gas demand, adding further uncertainty to the market sentiment.
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Disclaimer
Morpher is not liable for the content of the AI investment insights. Like most GPT-powered tools, these summaries may contain AI hallucinations and inaccurate information. Morpher is not presenting you with any investment advice. All investments involve risk, and the past performance of a security, industry, sector, market, or financial product does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs. These summaries do not constitute investment advice.