Key Takeaways
- • August natural gas futures settled at $2.858 on Thursday, down 6.6 cents, after touching a new six-week low of $2.823 intraday, per StoneX and CME data.
- • The EIA reported a 41 BCF injection for the week ended July 10, lifting working gas in storage to 3.024 TCF; the 5-year average surplus narrowed to 181 BCF while the year-over-year surplus widened to 21 BCF.
- • StoneX expects a 54 BCF build for the current week, well above the 5-year average of 30 BCF and last year's 27 BCF.
- • Strong domestic production, Canadian flows and reduced LNG feedgas due to Freeport LNG maintenance kept spot prices below $3.00.
- • Technical indicators are bearish: moving averages are aligned bearishly, trend-following indexes point lower, and RSI stands at 37.46.
Summary
August natural gas fell 6.6 cents on Thursday to settle at $2.858, according to StoneX and CME data. Strong domestic production and reduced LNG feedgas demand offset heat-driven gains in the power sector. Ongoing maintenance at Freeport LNG has limited demand growth and kept spot prices below the $3.00 level. The August contract traded to a new six-week low of $2.823 before recovering to close above the $2.850 support level.
The EIA reported a 41 BCF injection for the week ended July 10, slightly below expectations, bringing total working gas in storage to 3.024 TCF. The build narrowed the five-year average surplus to 181 BCF, while the year-over-year surplus widened to 21 BCF. Total consumption rose by about 3.4 BCF/d last week on stronger power sector demand. StoneX notes that market balances have loosened this week, as total demand held steady while domestic production and Canadian flows increased. Early estimates point to a 54 BCF build for the current week, versus a five-year average of 30 BCF and 27 BCF a year earlier.
Power burn has averaged 51 BCF/d over the past four days, supported by intense heat across the Midwest and Northeast and reduced wind and solar output in Texas. StoneX expects power burn to decline as temperatures moderate across the East. LNG feedgas flows were estimated at 16.6 BCF/d on Thursday, up from 15.9 BCF/d the previous day but well below recent highs near 19 BCF/d, and were estimated at 17.2 BCF/d this morning. The 6-10 day forecast shows limited heat across the Midwest and East, with hotter conditions expected in the West and farther South, according to NOAA.
Technically, StoneX identifies support at $2.690-$2.700 and the late-April low of $2.483 if Thursday's $2.823 low is broken. Resistance sits at the weekly high of $2.968, followed by the 10-day moving average near $3.015. The 10-, 40- and 200-day moving averages are aligned bearishly, the short- and long-term trend-following indexes are bearish, and the RSI is 37.46. The three-year seasonal pattern suggests August often marks a post-summer low.
The EIA reported a 41 BCF injection for the week ended July 10, slightly below expectations, bringing total working gas in storage to 3.024 TCF. The build narrowed the five-year average surplus to 181 BCF, while the year-over-year surplus widened to 21 BCF. Total consumption rose by about 3.4 BCF/d last week on stronger power sector demand. StoneX notes that market balances have loosened this week, as total demand held steady while domestic production and Canadian flows increased. Early estimates point to a 54 BCF build for the current week, versus a five-year average of 30 BCF and 27 BCF a year earlier.
Power burn has averaged 51 BCF/d over the past four days, supported by intense heat across the Midwest and Northeast and reduced wind and solar output in Texas. StoneX expects power burn to decline as temperatures moderate across the East. LNG feedgas flows were estimated at 16.6 BCF/d on Thursday, up from 15.9 BCF/d the previous day but well below recent highs near 19 BCF/d, and were estimated at 17.2 BCF/d this morning. The 6-10 day forecast shows limited heat across the Midwest and East, with hotter conditions expected in the West and farther South, according to NOAA.
Technically, StoneX identifies support at $2.690-$2.700 and the late-April low of $2.483 if Thursday's $2.823 low is broken. Resistance sits at the weekly high of $2.968, followed by the 10-day moving average near $3.015. The 10-, 40- and 200-day moving averages are aligned bearishly, the short- and long-term trend-following indexes are bearish, and the RSI is 37.46. The three-year seasonal pattern suggests August often marks a post-summer low.
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