HomeIndustriesU.S. Natural Gas Rallies Amid Colder Weather

U.S. Natural Gas Rallies Amid Colder Weather

U.S. natural gas rallied by 10% on Monday, thereby reaching its highest value in over a week. This comes after the release of weather forecasts for colder-than-expected conditions and, as a result, higher demand for heating over the next two weeks.

Front-month gas futures on the New York Mercantile Exchange 56.1 cents, or 9%, to $6.806 per million British thermal units (mmBtu).

Data provider Refinitiv has forecast 504 heating degree days over the next two weeks in the Lower 48 U.S. states compared to a 30-year average of 409 HDDs for the same period. As a result, Refinitiv forecast a rise in average U.S. gas demand from 123.4 billion cubic feet per day this week to 145.8 bcfd next week.

In addition to the changing demand forecast, investors’ eyes are also on Freeport LNG, which announced that it could return to partial operation as early as the end of next month. Initially scheduled for mid-December, Freeport decided to delay the restart of its liquefied natural gas (LNG) export plant in Texas until the end of the year, thereby leaving more gas in the United States for domestic use.

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