Houston — September natural gas futures decreased Friday, down 1.1 cents to $2.944/MMBtu, as power burn totals fell on the day.
The front-month contract traded Friday between $2.917/MMBtu and $2.955/MMBtu.
US demand fell 3.1 Bcf/d Friday to 70.8 Bcf/d as demand reached its lowest levels in five days, according to S&P Global Platts Analytics data.
Most of the fall in the US demand was due to the decrease in power burn totals, as power burn fell 2.7 Bcf/d to 36.8 Bcf/d Friday, the data showed. Midwest power burn saw the largest decrease on the day, falling 24% to 2.89 Bcf/d.
The decrease in US demand has mitigated the recent strength in the market and reverted back to the bearish sentiment the market has been experiencing over the summer.
Adding to the bearish sentiment, strong US dry gas production remained above 80 Bcf/d for the seventh consecutive day as production fell 600 MMcf/d, to 80.6 Bcf/d Friday, according to Platts Analytics data.
The strong production has kept a handle on the NYMEX futures prices as inventories currently stand at 2.354 Tcf, widening the deficit to the five-year average to 572 Bcf.
The forecast for the weekly storage change for the week ending August 9 is a 29 Bcf/d build, well below the five-year average of a 56 Bcf/d increase for the same week, according to Platts Analytics.
Looking ahead to the NYMEX winter strip, the market has expressed confidence in producers' ability to make up for the storage deficit going into the winter months, as November and March currently sit below the $3/MMBtu mark.
The NYMEX settlement price is considered preliminary and subject to change until a final settlement price is posted at 7 pm EDT (2300 GMT).
