Changes in supply and demand that pushed Natural Gas futures lower at the start of the week gave the market a boost on Tuesday. The Julymey Nx gas futures contract rose 6.7 cents to $3.258 due to a substantial drop in output, which is anticipated to be transitory, and a warmer swing in the latest weather predictions. August saw a 6.2 cent increase to $3.277.Spot gas prices rose as well, but the gains were generally minor. The National Avg. of NGI Spot Gas increased 2.0 cents to $3.095. According to Bespoke Weather Services, the weather forecast was just slightly hotter early Tuesday, adding a couple of -weighted degasgree days to the 15-day projection.
However, this type of slight variation has been common over the previous week, and it hasn’t impacted the general prognosis, with the majority of the heat remaining in the West. A considerably more significant movement occurred on the supply sizde, which presumably played a more substantial role in the higher price on Tuesday.
Top day estimates from Wood Mackenzie indicated output down 2 Bcf per day to 90.9 Bcf/d. The losses, however, were concentrated in locations with maintenance or operating concerns. The Gulf South Pipeline’s Hall Summit Compressor Station, for example, is undergoing maintenance in the Haynesville Shale. Work on the project began on Tuesday and is slated to remain until Thursday.
A force majeure declaration on the El Paso Natural Gas Pipeline, which had no expected return to operation, has decreased Permian Basin production in West Texas and New Mexico. Production is also declining in the Northeast, particularly along the Tennessee Gas Pipeline (TGP), under construction in Northeast Pennsylvania. TGP’s Station 321 has been closed since June 14. Still, Wood Mackenzie analysts Laura Munder and Nicole McMurrer said in a letter to clients that “scheduled maintenance at Station 325 began Tuesday, significantly reducing flows.”