Natural gas futures rallied on Tuesday, marking a stark reversal from the start of the week, as both LNG and near-term domestic-weather demand held strong and production ticked lower.

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At A Glance:

  • Output below 102 Bcf/d
  • Weather outlook mixed
  • LNG calls holding strong

Coming off a 13.1-loss on Monday – its first day as the front month – the December Nymex gas futures contract settled at $3.575/MMBtu on Tuesday, up 22.3 cents day/day. 

NGI’s Spot Gas National Avg. shed 12.5 cents to $3.255, easing back after Monday’s 48.5-cent surge and big gains last week.

Production was just under 102 Bcf/d, according to Wood Mackenzie’s Tuesday estimate. That was more than 1 Bcf/d lower than peak readings last week, due in part to freeze-offs in the Rockies.

On the demand...