27.07.202602:13:47UTC+00US Natural Gas Drops to 11-Week Low

US natural gas futures fell more than 2% to $2.80 per MMBtu on Monday, the lowest level since May 8, mirroring a broader pullback in global energy prices as tensions in the Middle East eased. Iran announced on Sunday that it had suspended retaliatory attacks on US allies in the region after Washington halted its own strikes on the country on Friday.

Domestic gas prices also weakened on robust supply. EIA data show that US natural gas inventories were 6.4% above the five-year seasonal average as of July 17. At the same time, average output in the Lower 48 states has edged up to 110.4 bcfd so far in July, compared with 110.0 bcfd in June.

LNG export demand has softened as well. Gas flows to major export terminals have averaged 17.2 bcfd so far this month, slightly below June’s 17.4 bcfd, in part due to scheduled maintenance at Freeport LNG’s facility in Texas.

Looking ahead, temperatures are expected to remain mostly above normal through August 8, which should keep power-sector gas demand firm as utilities burn more fuel to meet cooling needs.