Cooler US Weather Forecasts Boost Nat-Gas Prices

Core Insights - Natural gas prices in the US saw a significant increase, with November Nymex natural gas closing up by 4.20% due to cooler weather forecasts that are expected to boost heating demand [1] Production and Demand - The EIA has raised its forecast for US natural gas production in 2025 by 0.5% to 107.14 billion cubic feet per day (bcf/day), indicating a bearish factor for prices as production is near record highs [2] - US dry gas production was reported at 105.9 bcf/day, reflecting a year-over-year increase of 3.7%, while gas demand decreased to 69.0 bcf/day, down 5.8% year-over-year [3] Inventory and Storage - Natural gas inventories increased by 53 billion cubic feet (bcf) for the week ending September 26, which was below market expectations and the 5-year average, indicating adequate supply levels [5] - As of October 5, European gas storage was reported to be 83% full, compared to the 5-year seasonal average of 90% [5] Rig Count and Production Capacity - The number of active US natural gas drilling rigs rose to 118, slightly below the 2-year high of 124 rigs, showing an increase from a 4.5-year low of 94 rigs reported in September 2024 [6]