On Tuesday, August Nymex natural gas (NGQ25) closed down by $0.073, or 2.20%, reaching a 1.5-week low amid expectations of cooler temperatures across the U.S., reducing demand for air conditioning. Weather forecaster Vaisala indicated that Midwest temperatures are likely to be milder from July 27 to August 5.
Additionally, the number of active U.S. natural gas drilling rigs increased by 9 to a 17-month high of 117 rigs, according to Baker Hughes. Meanwhile, Lower-48 state dry gas production on Tuesday was reported at 107.2 billion cubic feet per day (bcf/day), a 3.9% year-on-year increase, while demand stood at 78.1 bcf/day, down 2.8% year-on-year.
Moreover, total U.S. electricity output rose by 1.1% year-on-year to 98,133 gigawatt hours (GWh) in the week ending July 12. Natural gas inventories increased by 46 bcf during the week ending July 11, exceeding both the consensus forecast and the five-year average, indicating sufficient supply levels.
