Natural gas markets were trading sharply lower through midday trading Wednesday amid signs of capitulation by bulls. Physical prices, meanwhile, were lower for the eastern half of the country ahead of a stretch of cooler weather.
Here’s the latest:
- August Nymex natural gas futures down 16.6 cents to $2.022/MMBtu as of 2:12 p.m. ET
The prompt month broke out of a choppy trade pattern before 9 a.m. ET, shedding 14 cents in around an hour. “Feels like someone blowing up here,” a market participant said on online energy platform Enelyst. “I agree,” another participant said. “Someone just wants out.”
The contract traded down toward two technical support levels: the psychologically important $2 threshold and the Henry Hub cash markets' $1.950-2.050 trading range.
The sell-off came as Freeport LNG Development LP in Texas would begin slowly ramping up after being down for a week following damages caused by former Hurricane Beryl. On Wednesday, the facility was scheduled to receive about 417 MMcf of feed gas used for making liquefied natural gas, or 16% of its capacity, according to NGI’s U.S. LNG Export Flow Tracker.
U.S. LNG feed gas flows were marginally higher day/day at about 10.75 Bcf/d, NGI data show.
- Natural gas cash prices averaging lower for Thursday deliveries, according to NGI’s MidDay Price Alert
- Henry Hub averaging $1.980, down 10.0 cents; Northeast Regional Avg. averaging $1.880, down $1.640
A series of weather systems were expected to sweep across the midsection of the country from Thursday to Tuesday, dropping highs into the 70s and 80s in the Midwest, Northeast and South Plains, NatGasWeather said. The moderating heat would extend to Texas and “drop national demand to the lightest levels in more than a month,” the forecaster said.
The trend was forecast to reverse next week, when high pressure may return over much of the Lower 48 on Tuesday, pushing highs into the upper 80s to 100s, NatGasWeather said. Wet weather in Texas, the South and Great Lakes region would prevent national demand from reaching “extreme levels” during the last week of the month. The warmer trend could continue during the first 10 days of August, with forecasts pointing to strong demand for natural gas, the firm said.
For Thursday, much of the Central and Upper Midwest was forecast to see highs in the 70s, according to the National Weather Service. Highs in the West ranged from the 90s to 100s, while the East Coast ranged from the 80s to 90s, the data show.
