Last Week in Natural Gas
Last week belonged to the bears. Thursday’s EIA release printed a +61 Bcf injection for the week ending July 3, comfortably above the roughly +49 Bcf consensus and above the ~51 Bcf five-year norm, lifting working gas to 2,983 Bcf and stretching the surplus to the five-year average to 185 Bcf, or about 6.6%. The looser build confirmed what the tape had been signaling all week: production running near record levels is outrunning even strong summer cooling load. The front month cracked more than 6% on Thursday to close near $3.01, a six-week low, then leaked lower Friday to hold around the $3.00 handle. The trigger on the demand side was Freeport LNG, which confirmed a major maintenance turnaround beginning July 10 and running into late August — a fresh drag on export pull just as the market wanted a bid. Above-normal temperatures forecast through July 23 kept power burn firm and cushioned the break, but ample supply and the storage overhang did the talking.
The Week Ahead
The next catalyst is Thursday’s EIA release on July 16, covering the week ending July 10. Estimates are coalescing around another loose print — a build in the upper-40s to mid-50s Bcf against a ~37 Bcf five-year norm — which would push the surplus wider still and reinforce the comfortable-supply narrative. The bigger swing factor is Freeport: with the turnaround pulling feedgas through late August, export demand stays capped near-term even as Golden Pass steadies deliveries after its late-June swoon and structural export capacity keeps ramping. Watch the daily nomination data for how deep the Freeport pull actually cuts. Weather stays supportive into the July 23 window, so heat-driven power burn remains the bulls’ best card, but the curve is pricing a shoulder-season fade — September and October both sit under the August contract. The setup favors selling rallies into strength unless a genuine heat dome or an early tropical threat rewrites the supply-disruption picture.
In Plain English
Natural gas prices fell last week, dropping to a six-week low near $3 after the government’s weekly report showed more gas flowing into storage than expected. The country is producing near-record volumes, and stockpiles are running well above what’s normal for this time of year, so supply looks comfortable despite a hot summer. Adding to the pressure, the Freeport export plant in Texas began a lengthy maintenance shutdown that will curb demand into late August. Hot weather is still boosting air-conditioning use, which offers some support, but for now the balance of forces is pushing prices lower rather than higher.