News wire -- U.S. natural gas futures fell over 4% on Monday
as liquefied natural gas (LNG) exports continue to drop on
record low gas prices in Europe and Asia.
That price decline came despite forecasts for warmer weather
and higher air conditioning demand over the next two weeks than
previously expected.
Front-month gas futures for July delivery fell 7.7 cents,
or 4.2%, to $1.772 per million British thermal units at 8:36
a.m. EDT (1236 GMT).
Data provider Refinitiv said gas output in the U.S. Lower 48
states was on track to fall to 87.6 billion cubic feet per
day (bcfd) on the first day of June, down from a one-year
low of 89.3 bcfd in May and an all-time monthly high of
95.4 bcfd in November.
With warmer weather coming, Refinitiv projected demand,
including exports, would rise from 80.2 bcfd this week to
81.8 bcfd next week. That is much higher than Refinitiv's
forecasts on Friday of 78.5 bcfd this week and 79.3 bcfd next
week.
With U.S. gas prices expected to remain higher than European
benchmarks through September, the amount of pipeline gas
flowing to U.S. LNG export plants was on track to fall to
a nine-month low of 4.3 bcfd on the first day of June as
buyers cancel cargoes. That is down from an 8-month low of
6.4 bcfd during May and a monthly record high of 8.7 bcfd
in February.
Most of the daily decline in LNG exports is expected at
Cheniere Energy Inc's exports plants at Sabine Pass in
Louisiana and Corpus Christi in Texas, according to early
Refinitiv data.
Analysts at Energy Aspects said they expect around 125 U.S.
cargoes to be shut-in this summer, potentially slashing
LNG deliveries to Europe by up to 424 billion cubic feet
compared to what was expected at the start of the summer.
