US natural gas futures rose above $9.50 per million British thermal units, a level not reached since August 2008; buoyed by increasing domestic and international demand and production decline.
Consumption and demand for cooling increased as the weather warmed in the US, which is a significant price driver in the near term, as energy demand prepares to break a record this week in Texas.
On a general level, Russia’s war on Ukraine has caused a global energy crisis, with US LNG demand set to remain high in part due to Europe’s calls for US exports to help reduce dependence on Russian gas.
On the supply side, data provider Refinitiv said average gas production in the 48 US states fell to 94.7 billion cubic feet per day so far in June from 95.1 billion cubic feet per day in May, compared to a monthly record of 96 billion.
Data from the EIA showed that gas held in storage facilities in the United States increased more than expected last week.
On May 25, global natural gas prices rose to more than $9 per million British thermal units, reaching their highest levels in more than a decade, with the dwindling stock announcement.