On Tuesday, July Nymex natural gas (NGN25) prices fell by 4.35%, closing down by -0.161 to reach a one-week low. This decline was driven by forecasts predicting cooler temperatures across parts of the southwestern and south-central U.S., which could reduce demand for natural gas from electricity providers.
Additionally, easing geopolitical risks following a ceasefire between Israel and Iran contributed to the lower prices. The Strait of Hormuz, vital for LNG shipments that account for about 20% of global LNG trade, is now less likely to face disruption. On the production front, lower-48 state dry gas output was reported at 104.4 billion cubic feet per day (bcf/day), while demand stood at 80.3 bcf/day, according to BNEF.
Baker Hughes reported a slight decrease in active U.S. natural gas drilling rigs, down by 2 to 111 rigs for the week ending June 20, reflecting a rise from the previous year’s low of 94 rigs in September 2024.
