U.S. natural gas futures settled slightly lower on Tuesday, bouncing off an early drop of more than 3% to a one-week low, with prices pressured by a broader energy market selloff, easing summer cooling demand forecasts and weaker LNG export activity.
Front-month gas futures for September delivery NGc1 on the New York Mercantile Exchange fell 1.2 cents, or 0.4%, to settle at $2.77 per million British thermal units. The session low was its lowest level since August 18.
Futures for October NGc2, which will soon be the front-month contract, held around $2.836 per mmBtu.
Prices are down due to a broader energy market selloff, said Robert DiDona, president of Energy Ventures Analysis, adding that demand has weakened as the market exits a period of extreme summer heat, leading to looser U.S. supply-demand balances, while reduced LNG export plant output in recent days has added to pressure on prices.
Oil prices fell 3% to a one-week low as traders shrugged off the latest U.S. sanctions campaign against Iran, viewing economic pressure as posing less risk to oil supplies than a military escalation. O/R