US natural gas prices jump 8% to 11-week high on output drop
UNG•US natural gas futures rose 7.9% to $3.263 per million British thermal units, reaching an 11-week high as daily output was expected to fall to 108.4 billion cubic feet per day. Energy firms added 53 billion cubic feet to storage, while the surplus over the five-year average narrowed to 2.9%.
1. Futures climb
October natural gas futures rose 24 cents, or 7.9%, to $3.263 per million British thermal units on Thursday, their highest close since July 7. The gains came as output was on track to fall to an 11-week low of 108.4 billion cubic feet per day, and flows to US liquefied natural gas export plants increased this month.
2. Storage build slows
The Energy Information Administration said energy firms added 53 billion cubic feet to storage in the week ended September 18, compared with 77 billion cubic feet in the same week last year and a five-year average build of 76 billion. The storage surplus over the five-year average narrowed to 2.9% from 3.7% the prior week.
3. Traders and exports
Analysts said short-covering likely amplified Thursday’s gains after prices held above $3 per million British thermal units for a second day. Average gas flows to the nine major US LNG export plants were 17.8 billion cubic feet per day so far in September, up from 17.2 billion in August.
