On Monday, July Nymex natural gas prices closed at $3.74, up by +0.167, or +4.66%. This surge was driven by forecasts of hotter temperatures in the eastern U.S. from June 21-25, which are expected to increase demand from electricity providers for air conditioning.
Additionally, European natural gas prices hit a 2-1/2 month high due to supply concerns stemming from geopolitical tensions, including an Israeli attack on Iran’s South Pars gas field. The latest data shows lower-48 state dry gas production at 105.8 Bcf/day, a 2.6% year-over-year increase, while demand reached 69.5 Bcf/day, up 1.1% year-over-year. LNG net flows to U.S. export terminals also increased to 14.0 Bcf/day, up 2.1% week-over-week.
However, the Edison Electric Institute reported a 2.7% year-over-year decline in total U.S. electricity output for the week ending June 7, although output for the year-long period rose 3.0% year-over-year. Baker Hughes indicated a slight decrease in active U.S. nat-gas drilling rigs, with the count falling to 113 from a 15-month high of 114.
