On Wednesday, September Nymex natural gas (NGU26) closed up +0.006 (+0.22%), attributed to warmer weather forecasts across the Western U.S., potentially increasing demand from electricity providers. The Commodity Weather Group forecasts above-average temperatures through August 14.
Despite the slight gains, a larger-than-normal expected build of +30 bcf in weekly EIA natural gas inventories for the week ending July 31 weighs on prices, higher than the five-year average of +23 bcf. Additionally, the Hugh Brinson pipeline is set to operate at full capacity of 1.5 bcf/day by September 1, increasing supplies from the Permian Basin to the Henry Hub in Erath, Louisiana.
Current U.S. dry gas production stands at 111.4 bcf/day, a 2.6% increase year-over-year, while demand is at 81.4 bcf/day, up 8.4% year-over-year. As of August 3, European gas storage is 58% full, compared to a five-year average of 74% for this time of year.
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