US natgas prices jump 9% to 13-week high on output drop, technical buying
UNG•U.S. natural gas futures rose 9.1% to settle at $3.297 per million British thermal units, their highest close since June 25. The EIA reported a 53-billion-cubic-foot storage build, while daily Lower 48 output was on track to fall to 108.4 billion cubic feet per day.
1. Futures climb sharply
October natural gas futures settled up 27.4 cents, or 9.1%, at $3.297 per million British thermal units, the contract’s biggest daily percentage gain since January. Prices reached their highest close since June 25 and moved above the $3 level for a second day. Analysts said short-covering likely amplified the rise after prices held above technical resistance.
2. Storage surplus narrows
Energy firms added 53 billion cubic feet of gas to storage in the week ended September 18, matching analysts’ forecast and below the 76-bcf five-year average and 77-bcf build a year earlier. Storage was 2.9% above the five-year average, down from 3.7% the prior week.
3. Output and LNG flows
Average Lower 48 output was 112.8 billion cubic feet per day so far in September, but daily output was on track to fall to an 11-week low of 108.4 bcfd on Thursday, mainly due to declines in Louisiana and West Virginia. Average flows to the nine major U.S. LNG export plants rose to 17.8 bcfd in September from 17.2 bcfd in August.
