Natural Gas Update 6-13-2025

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Natural Gas--NG is up 5.1 cents
NG futures are higher on the back of the sharp rise in energy prices, although the rise in NG is muted due to the ample supply of gas in storage in the U.S. and the fact that NG futures are a more domestically U.S. based price mechanism versus the global nature of the other energies. But, European natural gas prices are much higher as the Mideast is a key source for much of foreign supply.

NaGasWeather.com said Thursday that forecasts shifted warmer to hotter for much of the southern two-thirds of the US for June 19-26, potentially boosting natural gas demand. (Nasdaq) Lower 48 natural gas demand is estimated today at 70.28 BCF/d compared to the previous five-year average around 66.4 BCF/d for this time of year. (Bloomberg)

U.S. domestic natural gas production is estimated down 0.945 BCF/d at 105.40 BCF/d today compared to a 30-day average of 106.4 BCF/d, according to Bloomberg data, although the daily figure could still be revised later in the day.

TTF futures prices have gapped higher today in the face of the Mideast attacks. “So far TTF prices are still contained, but there is a higher risk premium now back in the market", as per one European bank analyst.  Traders are concerned about potential disruptions in the Strait of Hormuz, where roughly a fifth of global LNG passes through. “Qatar, Oman and the UAE operate roughly 18% of the world’s LNG supply, so any disruptions to flows from especially Qatar could easily see TTF prices back in the EUR100/MWh,” the bank analyst adds. (WSJ) There are further supportive elements for European natural gas prices. Wind power generation is expected to decline over the weekend in northwestern Europe, reducing the supply of renewable energy. In France, concerns are mounting over a potential reduction in nuclear output after the national regulator reported early signs of possible stress corrosion in a reactor. Meanwhile, unseasonably hot weather across much of Europe is driving up electricity demand for air conditioning. (Trading Economics) Currently TTF spot futures are printing near Euro 38/Mwh (= $12.80/MMBTU) The gap seen today goes from 36.650 to 36.900 Euro. The DC chart upper bollinger is being tested. Initial upside resistance is seen at the 40 Euro area and then at Euro 44. Support comes in at the 34.25 Euro area.

The EIA gas storage data showed a build of 109 BCF, which was basically in line with forecasts. Total storage rose to 2.707 TCF. This is +139 BCF/+5.41% versus the 5 year average, but -256 BCF/-8.64% versus last year's level. Celsius Energy is forecasting another 100+ BCF injection for next week's EIA gas storage data. They also see a further widening of the storage surplus to the 5 year average in the weeks to follow.

Analysts at Morgan Stanley expect natural-gas storage to return to a deficit over the summer, pushing prices above $5 per million British thermal units in the second half of the year. They expect underground storage to end October at 3.68 trillion cubic feet, slightly below the five-year average, and fall to 1.4 trillion cubic feet at the end of March 2026, or 22% below the five-year average. (WSJ)

Warmer weather and additional natural gas-fired power plants are fueling Mexico’s growing natural gas import needs. Pipeline exports to Mexico have averaged 7.5 BCF/d over the past 30 days, up 0.5 BCF/d from the same period last year, according to Wood Mackenzie. June is on track for an all-time monthly record, Wood Mackenzie adds. (NGI)

Technically NG spot futures still have negative momentum. Overnight prices rose to the high of the session in reaction to the news of the Israeli attacks on Iran. Resistance above is seen at 3.656-3.662. Support comes in at the low of the week at 3.453-3.454.

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