May Nymex natural gas prices closed at $2.69 per million British thermal units, rising $0.015 (+0.56%) on Monday, April 17, reaching a 1.5-week high. This increase is attributed to cooler weather forecasts across the U.S., which are expected to elevate heating demand. The Commodity Weather Group predicts below-average temperatures from April 25-29 in the Western U.S. and April 30 to May 4 in the Eastern U.S.
U.S. dry natural gas production was reported at 109.1 billion cubic feet per day (bcf/day), a 2.0% increase year-on-year. This figure comes amid rising natural gas inventories, which are 5.8% above their five-year seasonal average, as noted in the recent EIA report. Additionally, the Ras Laffan gas export plant in Qatar, which contributes about 20% of the global liquefied natural gas supply, has suffered damage that could impact global markets for up to three years.
Despite temporary support from forecasts of tighter global LNG supplies, the U.S. electricity output fell by 1.0% year-on-year. Active U.S. natural gas drilling rigs decreased by two to 125, remaining below the 2.5-year high of 134 reached in late February. As of mid-April, European gas storage was 30% full, compared to a five-year average of 43% for this time of year.
