US natural gas futures climbed toward $3.35 per MMBtu on Wednesday, approaching the one-year high of $3.50 reached earlier this month.
Natural gas extends rebound
This increase was driven by expectations of stronger global LNG demand in the coming year, which overshadowed concerns about domestic supply. Uncertainty surrounding gas flows to Europe remained a key focus, as doubts persisted over whether central European economies would continue receiving Russian gas via Ukraine, particularly with the EU Commission’s stricter policies on phasing out Russian fossil fuels. This has led to a rise in demand for US LNG, especially with the upcoming US presidential transition.
Political moves
Incoming President Trump has indicated his administration will not restrict US LNG export permits, encouraging companies to prioritize more profitable exports over cheaper domestic gas sales, given the abundant supply in the US. Meanwhile, markets awaited the EIA’s weekly report on domestic natural gas stocks, with the US likely entering a period of inventory drawdowns, five weeks into the anticipated season.
