US natgas prices slide 2% on bigger than expected storage build

By Scott DiSavino

Oct 9 (Reuters) - U.S. natural gas futures slid about 2% to a one-week low on Thursday on a slightly bigger than expected storage build and a smaller decline in daily output than previously expected.

The U.S. Energy Information Administration (EIA) said energy firms injected 80 billion cubic feet (bcf) of gas into storage during the week ended October 3.

That was slightly bigger than the 77-bcf build analysts forecast in a Reuters poll and compares with an increase of 78 bcf during the same week last year and an average build of 94 bcf over the past five years. EIA/GAS NGAS/POLL

Front-month gas futures for November delivery NGc1 on the New York Mercantile Exchange fell 6.4 cents, or 1.9%, to settle at $3.269 per million British thermal units (mmBtu), their lowest close since September 29.

That decline came despite forecasts for cooler, more near-normal weather and higher demand over the next two weeks than previously projected.

In the cash market, average prices at the Waha Hub NG-WAH-WTX-SNL in the Permian Shale in West Texas fell back into negative territory on Wednesday for the 11th time in the last 12 days as ongoing pipeline maintenance, like work on Kinder Morgan's KMI.N Permian Highway, trapped gas in the nation's biggest oil-producing basin.

That was the 20th time Waha prices have dropped below zero so far this year and compares with an average of $1.40 per mmBtu so far in 2025, 77 cents in 2024, and $2.91 over the previous five years (2019-2023).

Waha first averaged below zero in 2019. It happened 17 times in 2019, six times in 2020, once in 2023, and a record 49 times in 2024.

In the tropics, the U.S. National Hurricane Center projected Tropical Storm Jerry would strengthen into a hurricane on Friday after passing the northern Caribbean Islands and then turning northeast toward the open Atlantic Ocean by early next week. Jerry is not expected to hit the U.S. mainland.

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 states fell to 106.3 billion cubic feet per day so far in October, down from 107.4 bcfd in September and a record monthly high of 108.0 bcfd in August.

On a daily basis, output was on track to drop to a preliminary three-month low of 104.9 bcfd on Thursday. Preliminary data, however, is often revised later in the day. Thursday's projected daily output was higher than forecast on Wednesday and compares with a daily record high of 109.2 bcfd on July 28.

Record output earlier this year allowed energy companies to inject more gas into storage than usual so far this summer. There was about 5% more gas in storage than normal for this time of year. EIA/GAS NGAS/POLL

Meteorologists forecast the weather will remain mostly near normal through October 24.

LSEG projected average gas demand in the Lower 48 states, including exports, would slide from 100.4 bcfd this week to 99.7 bcfd next week. Those forecasts were higher than LSEG's outlook on Wednesday.

The average amount of gas flowing to the eight big U.S. LNG export plants rose to 16.1 bcfd so far in October, up from 15.7 bcfd in September and a monthly record high of 16.0 bcfd in April.