U.S. Natural Gas Surges 4% as LNG Feedgas Demand Grows
U.S. natural gas futures climbed to their highest level in 19 weeks as stronger LNG demand, rising feedgas deliveries and hotter weather forecasts boosted market sentiment.
(Reuters) — U.S. natural gas futures jumped about 4% to a 19-week high on June 25 on a rise in gas flows to liquefied natural gas export plants in recent weeks and forecasts for hotter weather and higher demand this week than previously expected.
On their second-to-last day as the front-month, gas futures for July delivery on the New York Mercantile Exchange rose 12.2 cents, or 3.8%, to settle at $3.343 per million British thermal units (MMBtu), their highest close since February 6.
The August contract, which will soon be the front-month, gained about 1% to $3.30 per MMBtu.
The U.S. Energy Information Administration (EIA) said energy firms added a near-normal 76 billion cubic feet (Bcf) of gas into storage during the week ended June 19, keeping overall stockpiles around 5.7% above normal levels for this time of year.
That was close to the 74-Bcf build analysts forecast in a Reuters poll and compares with an increase of 96 Bcf during the same week last year and a five-year (2021-2025) average increase of 75 Bcf for the period.
Supply and Demand
Financial group LSEG said average gas output in the U.S. Lower 48 states held at 109.7 billion cubic feet per day so far in June, the same as in May. That compares with a monthly record high of 110.6 billion cubic feet per day in December 2025.
Meteorologists forecast the weather will remain mostly warmer than normal through July 10, which should boost the amount of gas power generators burn to keep air conditioners humming. About 40% of U.S. power generation comes from gas-fired plants.
LSEG projected average gas demand in the Lower 48 states, including exports, would rise from 102.9 billion cubic feet per day this week to 105.3 billion cubic feet per day next week. The forecast for this week was higher than LSEG's outlook on June 24.
Average gas flows to the nine big U.S. LNG export plants rose from 17.1 billion cubic feet per day in May to 17.3 billion cubic feet per day so far in June due in part to recent record feedgas at QatarEnergy/ExxonMobil's Golden Pass plant in service and under construction in Texas. That compares with a monthly record high of 18.8 billion cubic feet per day in April.
In other LNG news, two LNG vessels were sailing directly from the U.S. to China.
One tanker, the LNG Sakura, which has changed its destination more than once, left Berkshire Hathaway Energy's Cove Point LNG export plant in Maryland in mid-May and is expected to reach China around June 26, according to LSEG data. The other vessel is on track to reach China in mid-July.
So far, no LNG tanker has left a U.S. export plant and gone directly to China during U.S. President Donald Trump's second term, which started in January 2025, due primarily to trade disputes between the world's two biggest economies.
China, which imported a large amount of U.S. gas in the past and has many contracts to buy U.S. LNG, is the world's biggest gas importer, while the U.S. is the world's biggest gas producer, consumer and exporter. Chinese companies have bought U.S. LNG and then sold it to buyers in other countries.