August Nymex pure fuel (NGQ25) on Friday closed sharply increased by +0.213 (+6.04%).
Aug nat-gas costs on Friday rallied sharply in anticipation of hotter US climate boosting nat-gas demand from electrical energy suppliers to energy elevated air-conditioning utilization. Forecaster Atmospheric G2 mentioned Friday that forecasts shifted hotter for a lot of the US for July 7-11, aside from the southern tier and West Coast.
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Nat-gas costs sank to a 1-month nearest-futures low Thursday on a larger-than-expected construct in weekly EIA inventories. As of June 20, nat-gas inventories have been +6.6% above their 5-year seasonal common, signaling ample nat-gas provides. The easing of geopolitical dangers additionally undercut nat-gas costs this week because of the Israel-Iran ceasefire. The ceasefire reduces the chance that Iran will shut the Strait of Hormuz and disrupt LNG shipments by way of that Strait, which accounts for roughly 20% of worldwide LNG commerce.
Decrease-48 state dry fuel manufacturing on Friday was 105.2 bcf/day (+1.7% y/y), in accordance with BNEF. Decrease-48 state fuel demand on Friday was 74.3 bcf/day (+1.0% y/y), in accordance with BNEF. Estimated LNG web flows to US LNG export terminals on Friday have been 14.8 bcf/day (+7.4% w/w), in accordance with BNEF.
A decline in US electrical energy output is damaging for nat-gas demand from utility suppliers. The Edison Electrical Institute reported Wednesday that whole US (lower-48) electrical energy output within the week ended June 21 fell -3.1% y/y to 91,334 GWh (gigawatt hours), though US electrical energy output within the 52-week interval ending June 21 rose +2.6% y/y to 4,243,923 GWh.
Thursday’s weekly EIA report was bearish for nat-gas costs since nat-gas inventories for the week ended June 20 rose +96 bcf, above the consensus of +88 bcf and the 5-year common for the week of +79 bcf. As of June 20, nat-gas inventories have been down -6.6% y/y, however have been +6.6% above their 5-year seasonal common, signaling ample nat-gas provides. As of June 23, fuel storage in Europe was 57% full, in comparison with the 5-year seasonal common of 66% full for this time of yr.
Baker Hughes reported Friday that the variety of energetic US nat-gas drilling rigs within the week ending June 27 fell by -2 to 109 rigs, barely beneath the 15-month excessive of 114 rigs from June 6. Previously 9 months, fuel rigs have risen from the 4-year low of 94 rigs posted in September 2024.
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