Markets

January natural gas futures were down 6.9 cents to $4.476 shortly before 9 a.m. ET Tuesday as diverging outcomes from the major weather models were raising uncertainty over the timing of a potential return to colder temperatures later this month.

Strong growth in U.S. natural gas production in 2019 will outweigh low inventory levels and put downward pressure on prices, resulting in an average Henry Hub spot price of $3.11/MMBtu for the year, 6 cents below the 2018 average, according to the Energy Information Administration (EIA).

As liquefied natural gas (LNG) expands its share of global trade, the world’s gas demand will grow at the fastest rate among fossil fuels through 2040, according to a recent report from the Gas Exporting Countries Forum (GECF).

Natural gas futures sold off across the winter strip Tuesday as markets awaited further clues on the timing and strength of a potential return to colder temperatures later this month. In the spot market, prices sold off across most of the Lower 48 on expectations for milder national demand over the next few days, though points in volatile New England lurched higher; the NGI Spot Gas National Avg. fell 8.0 cents to $4.545/MMBtu.

Natural gas futures sold off across the winter strip Tuesday as markets awaited further clues on the timing and strength of a potential return to colder temperatures later this month. In the spot market, prices sold off across most of the Lower 48 on expectations for milder national demand over the next few days, though points in volatile New England lurched higher; the NGI Spot Gas National Avg. fell 8.0 cents to $4.545/MMBtu.

January natural gas futures were down 4.1 cents to $4.447/MMBtu shortly before 9 a.m. ET Monday, with forecasters noting milder trends over the weekend, but there are hints of cold returning later this month.

Between structural shifts in supply/demand balance and historically lean stockpiles, natural gas prices face major upside risks this winter, but even after recent gains, Henry Hub bulls should have room to run before U.S. liquefied natural gas (LNG) exports start to become uneconomic, according to analysts.

With two more liquefaction trains expected to send out their first liquefied natural gas (LNG) cargoes in the next few weeks and two other export facilities in the commissioning phase, the United States is on pace to have the third-largest export capacity in the world by the end of 2019, more than doubling its current export capacity to 8.9 Bcf/d, according to the Energy Information Administration (EIA.)

Despite trading in the negative early Monday, the possibility of cold weather returning to the United States around Christmas was enough to send natural gas futures prices nearly 18 cents higher by midday. The Nymex January gas futures contract eventually went on to settle up just 5.7 cents at $4.545, while February slipped 1.8 cents to $4.360 and March slid 1.9 cents to $4.136.