US natgas prices fall on smaller-than-expected gas draw from inventories
Dec 27 (Reuters) - U.S. natural gas futures fell on Friday as a weekly federal report showed a slightly smaller-than-expected storage withdrawal, and as traders booked some profits after prices rose as much as 3% earlier in the session on increasing amounts of gas flowing to liquefied natural gas export plants.
Front-month gas futures for January delivery on the New York Mercantile Exchange fell 3 cents, or 0.8%, to $3.69 per million British thermal units (mmBtu) as of 11:00 a.m. EST (1600 GMT).
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The contract is down about 1.8% so far this week after prices hit $4.01/mmBtu level on Thursday, its highest since Jan 2023.
"We've definitely seen some pullback because of the inventories, we came in -93 billion cubic feet...I think because of the holiday, the market took some profits after the report. The January contract is also probably seeing rollover pressure because January's going off the board here pretty quickly and we have an expiration coming up on that contract," said Phil Flynn, an analyst at Price Futures Group.
The U.S. Energy Information Administration (EIA) showed utilities pulled a smaller-than-usual 93 billion cubic feet (bcf) of gas out of storage during the week ended Dec. 20.
That was less than the 98-bcf withdrawal analysts forecasted in a Reuters poll and compares with a decrease of 87 bcf during the same week last year and a five-year average draw of 127 bcf for this time of year.
Financial firm LSEG estimated 399 heating degree days over the next two weeks, compared with 393 estimated on Thursday.
It also forecast average gas demand in the Lower 48, including exports, jumping to 141.5 billion cubic feet per day (bcfd) next week from 119.1 bcfd this week.
The amount of gas flowing to the eight big U.S. LNG export plants rose to an average of 14.8 bcfd so far in December from 13.6 bcfd in November.
U.S. liquefied natural gas (LNG) company Venture Global LNG's tanker Venture Bayou departed the Plaquemines export plant in Louisiana for Germany, carrying the first LNG cargo produced at the facility, the company said on Thursday.
LSEG said average gas output in the Lower 48 U.S. states rose to 103.1 bcfd so far in December from 101.5 bcfd in November. That compares with a record 105.3 bcfd in December 2023.
Dutch and British wholesale gas prices rose, supported by forecasts of cold weather in early January and fading hopes for a new deal to transit Russian gas through Ukraine. The benchmark front-month contract at the Dutch TTF hub was trading at $14.55 per mmBtu.
(Reporting by Anmol Choubey and Anjana Anil in Bengaluru; Editing by Chizu Nomiyama)