US Natural Gas Prices Rebound from 7-Week Low, Driven by LNG Export Surge

New York | EcoPulse24

US natural gas prices posted a notable rebound during December, with futures climbing to around $4.1 per million British thermal units (MMBtu) after dropping to a seven-week low of $3.89 on December 16. The uptick was supported by strong external demand for US liquefied natural gas (LNG) exports.

This price improvement coincided with near-record LNG export flows, as data showed that average supply to the eight major US LNG terminals reached 18.5 billion cubic feet per day since the start of December, surpassing the previous record set in November.

Forecasts indicate US net gas exports will continue to grow in the long term, supported by expanding export capacity and rising global demand, particularly from European and Asian markets.

Conversely, expectations of a relatively mild winter have curbed upward momentum, with the likelihood of reduced domestic demand for gas and electricity compared to colder seasons.

Despite this, the market anticipates that winter demand will outpace production, necessitating withdrawals from storage to cover the shortfall, which could provide further price support.

Gas inventories entered the winter above the five-year average, though slightly below last winter's levels. US production remains near record highs, partially offsetting supply shortage risks.

EcoPulse24 Analysis: The movement in natural gas prices reflects a delicate balance between record export strength, mild weather, and ample production. With expanding LNG exports, prices remain sensitive to sudden shifts in weather or storage withdrawals during peak winter.