NEW YORK: US natural gas futures hovered close to a three-week low on Tuesday, driven by forecasts of mild weather over the next two weeks that are likely to keep demand low.
The front-month gas futures for November delivery on the New York Mercantile Exchange were steady at $2.490 per million British thermal units (mmBtu) as of 8:11 a.m. EDT (1211 GMT). This marks the lowest closing price since September 20.
One reason for the declining prices has been the reduced demand from gas power generators. This decrease followed Hurricanes Milton and Helene, which knocked out electricity for millions of homes and businesses. Currently, about 193,000 customers in Florida are still without power due to Milton, which struck the state on October 9. Additionally, 12,000 customers in North Carolina remain without power from Helene, which affected Florida on September 26 before moving inland.
In total, Hurricane Milton caused approximately 3.4 million customers to lose power, while Hurricane Helene resulted in about 6 million outages.
The US National Hurricane Center has also noted a 60% chance that a disturbance in the Atlantic Ocean could develop into a tropical cyclone over the next week as it moves toward Puerto Rico and the Bahamas.
According to financial firm LSEG, average natural gas output in the Lower 48 US states decreased to 101.4 billion cubic feet per day (bcfd) so far in October, down from 101.8 bcfd in September. This figure is significantly lower than the record high of 105.5 bcfd recorded in December 2023.
These reductions in output this year have been influenced by many producers cutting back on drilling activities after the average spot monthly prices at the US Henry Hub benchmark in Louisiana fell to a 32-year low in March. Prices have largely remained low since then.
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