August Nymex natural gas closed at $2.88 per MMBtu on Friday, down 1.54%, nearing a recent 2.25-month low. Prices fell as U.S. gas inventories remained well above the five-year average and weather forecasts indicated cooler temperatures. BNEF reported U.S. dry gas production at 111.6 billion cubic feet per day (bcf/day), a year-over-year increase of 2.9%, while demand dropped to 77.6 bcf/day, down 6.5% year-on-year.
As of July 17, natural gas inventories rose by 32 bcf, exceeding the five-year average increase of 30 bcf. Despite this rise, inventories were still 0.6% lower than last year but 6.4% above the five-year seasonal average. Baker Hughes indicated that the number of active U.S. natural gas drilling rigs rose by one, totaling 127, but remains below the three-year high of 134 set in February.
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