US natgas futures climb 3% to 35-month high on record LNG flows, colder weather forecasts (updated)

US Global Investors

03/12/2025 17:01

Colder weather expected to increase gas demand for heating

Record LNG flows boost US natural gas demand

Cash gas prices rise to highest levels since last winter on extreme cold

Global gas prices lower amid Russia-Ukraine peace talks

Record output, ample storage limit price gains

Adds latest prices

By Scott DiSavino

NEW YORK, Dec 3 (Reuters) - U.S. natural gas futures climbed about 3% on Wednesday to a 35-month high, on record flows to liquefied natural gas (LNG) export plants and forecasts for colder weather and higher demand over the next two weeks than previously expected.

Limiting gains were record output, ample amounts of gas in storage and lower gas prices in Europe and Asia due mostly to the possibility that peace talks in Ukraine could result in the lifting of sanctions against Moscow. That could allow Russia, the world's second-biggest gas producer behind the U.S., to export more gas in the future.

Front-month gas futures for January delivery NGc1 on the New York Mercantile Exchange rose 15.5 cents, or 3.2%, to settle at $4.995 per million British thermal units (mmBtu), their highest close since December 27, 2022.

In intraday trade, the front-month briefly rose over the $5 per mmBtu psychological level of technical resistance. It also closed in overbought territory for the third time in four days.

Meteorologists forecast temperatures across the country will remain well below normal through December 9, with the most frigid weather expected on Thursday, before turning warmer than normal next week.

Extreme cold this week helped drive cash prices to their highest levels since January 2024 in New England NG-CG-BS-SNL and California NG-SCL-CGT-SNL, NG-CG-PGE-SNL and their highest levels since February at the Henry Hub benchmark NG-W-HH-SNL in Louisiana and in Pennsylvania NG-PCN-APP-SNL, Chicago NG-CG-CH-SNL and New York NG-CG-NY-SNL.

SUPPLY AND DEMAND

LSEG said average gas output in the Lower 48 states has risen to 109.7 billion cubic feet per day (bcfd) so far in December, up from a monthly record of 109.6 bcfd in November.

On a daily basis, however, output was on track to drop by 2.4 bcfd to a one-week low of 108.9 bcfd on Wednesday since hitting a daily record high of 111.3 bcfd on November 28.

Record output has allowed energy companies to stockpile more gas than usual, leaving about 5% more gas in storage than normal for this time of year. EIA/GAS NGAS/POLL

LSEG projected average gas demand in the Lower 48 states, including exports, would fall from 145.1 bcfd this week to 142.9 bcfd next week. Those forecasts were higher than LSEG's outlook on Tuesday.

Average gas flows to the eight big LNG export plants operating in the U.S. have risen to 18.4 bcfd so far in December, up from a monthly record high of 18.2 bcfd in November.

Freeport LNG's export plant in Texas was on track to take in more gas on Wednesday in a sign that one of the plant's three liquefaction trains has returned to service after shutting on Tuesday.

The U.S. became the world's biggest LNG producer in 2023, surpassing Australia and Qatar as surging global prices fed demand for more exports, due in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

Around the world, gas prices held near an 18-month low of around $10 per mmBtu at the Dutch Title Transfer Facility (TTF) TRNLTTFMc1 in Europe on hopes of a possible peace plan for Russia and Ukraine, while prices at the Japan-Korea Marker (JKM) JKMc1 in Asia slid to a three-month low near $11. NG/EU

Week ended Nov 28 Forecast
Week ended Nov 21 Actual
Year ago Nov 28
Five-year average Nov 28
U.S. weekly natgas storage change (bcf):
-18
-11
-26
-43
U.S. total natgas in storage (bcf):
3,917
3,935
3,941
3,732
U.S. total storage versus 5-year average
+5.0%
+4.2%
Global Gas Benchmark Futures ($ per mmBtu)
Current Day
Prior Day
This Month Last Year
Prior Year Average 2024
Five-Year Average (2019-2023)
Henry Hub NGc1
4.97
4.84
3.41
2.41
3.52
Title Transfer Facility (TTF) TRNLTTFMc1
9.60
9.54
13.83
10.95
15.47
Japan-Korea Marker (JKM) JKMc1
11.00
11.07
14.34
11.89
15.23
LSEG U.S. Global Forecast System (GFS) Heating, Cooling and Total Degree Days
Two-Week Total Forecast
Current Day
Prior Day
Prior Year
10-Year Norm
30-Year Norm
U.S. GFS Heating Degree Days (HDD)
430
427
397
360
397
U.S. GFS Cooling Degree Days (CDD)
5
5
3
6
4
U.S. GFS Total Degree Days (TDD)
435
432
400
366
401
LSEG U.S. Weekly GFS Supply and Demand Forecasts
Prior Week
Current Week
Next Week
This Week Last Year
Five-Year (2020-2024) Average For Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production
110.5
110.5
110.2
103.7
99.3
U.S. Imports from Canada
8.8
9.8
9.2
N/A
8.9
U.S. LNG Imports
0.0
0.0
0.0
0.0
0.1
Total U.S. Supply
119.2
120.3
119.5
N/A
108.3
U.S. Demand (bcfd)
U.S. Exports to Canada
3.2
3.0
3.0
N/A
3.3
U.S. Exports to Mexico
6.1
6.2
6.1
N/A
5.4
U.S. LNG Export Feedgas
18.6
18.7
18.3
14.2
12.8
U.S. Commercial
12.1
17.6
17.7
17.5
14.9
U.S. Residential
18.9
29.9
29.8
29.3
24.2
U.S. Power Plant
31.4
34.9
33.3
36.3
33.6
U.S. Industrial
24.3
26.2
26.0
26.2
25.2
U.S. Plant Fuel
5.5
5.5
5.4
5.5
5.7
U.S. Pipe Distribution
2.5
3.1
3.1
2.5
4.2
U.S. Vehicle Fuel
0.1
0.1
0.1
0.1
0.2
Total U.S. Consumption
94.8
117.2
115.5
117.4
108.0
Total U.S. Demand
122.8
145.1
142.9
N/A
129.5
N/A = Not Available
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam (Fiscal year ending Sep 30)
2026 Current Day % of Normal Forecast
2026 Prior Day % of Normal Forecast
2025 % of Normal Actual
2024
% of Normal Actual
2023
% of Normal Actual
Apr-Sep
90
90
76
74
83
Jan-Jul
88
88
78
76
77
Oct-Sep
89
89
80
77
76
U.S. weekly power generation percent by fuel - EIA
Week ended Dec 5
Week ended Nov 28
2024
2023
2022
Wind
12
11
11
10
11
Solar
4
5
5
4
3
Hydro
5
5
6
6
6
Other
1
1
1
2
2
Petroleum
0
0
0
0
0
Natural Gas
39
39
42
41
38
Coal
19
8
16
17
21
Nuclear
20
21
19
19
19
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub
Current Day
Prior Day
This Month Last Year
Prior Year Average 2024
Five-Year Average (2019-2023)
Henry Hub
4.83
5.08
3.02
2.19
3.49
Transco Z6 New York
5.21
5.23
3.31
1.98
3.29
PG&E Citygate
4.62
4.75
3.42
3.04
5.47
Eastern Gas (old Dominion South)
4.28
4.33
2.70
1.68
2.77
Chicago Citygate
4.49
4.45
2.82
2.00
3.41
Algonquin Citygate
22.25
13.00
8.16
2.88
4.27
SoCal Citygate
4.68
4.95
3.54
2.47
5.92
Waha Hub
0.85
1.504
2.28
0.77
2.91
AECO
2.19
2.19
1.26
0.96
2.28
ICE U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub
Current Day
Prior Day
This Month Last Year
Prior Year Average 2024
Five-Year Average (2019-2023)
New England
149.57
124.28
85.01
47.35
48.44
PJM West
74.76
80.39
43.03
41.98
45.33
Mid C
54.95
46.96
42.33
63.89
61.73
Palo Verde
47.76
36.00
32.02
39.50
62.42
SP-15
46.27
46.66
39.19
31.30
58.87

 (Reporting by Scott DiSavino; Editing by Paul Simao and David Gregorio)

 ((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net/))