US Natural Gas Prices Rise 5% on Strong LNG Export Demand and Lower Inventories

Washington | EcoPulse24

US natural gas futures posted a notable gain on Wednesday, jumping about 5% to $3.46 per million British thermal units. The rally was fueled by increased flows to LNG export terminals amid continued robust global demand.

Data showed that average gas flows to the eight largest US LNG export terminals reached approximately 18.3 billion cubic feet per day since the beginning of February, up from 17.8 billion in January and approaching the record of 18.5 billion set in December.

The US has strengthened its position as the world's top LNG exporter since 2023, benefiting from rising global demand following supply disruptions after Russia's invasion of Ukraine in 2022.

Weather forecasts indicate above-normal temperatures across most US regions through February 19, with the Northeast remaining below average for a longer period, partially easing seasonal pressure on domestic demand.

Meanwhile, average gas production in the lower 48 states edged up slightly to 106.4 billion cubic feet per day in February, compared to 106.3 billion in January. Analysts estimate recent polar cold snaps have triggered strong inventory withdrawals, shifting storage levels from about 5% above average to nearly 1% below the norm.

EcoPulse24 Analysis
The rise in US natural gas prices reflects a delicate balance between export growth and short-term supply pressures. Strong LNG export demand continues to support prices as flows near record levels, while the weather impact remains milder than anticipated. With inventories now below average, the market is poised for further volatility in coming weeks, especially if new cold spells coincide with sustained export momentum.