US natural gas futures edged down on Wednesday in thin pre-holiday trading, after touching a near two-week high, supported by forecasts for colder weather and robust gas flows to liquefied natural gas export plants.
Front-month gas futures for January delivery on the New York Mercantile Exchange were down 16.6 cents, or 3.8 per cent at $4.242 per million British thermal units, after hitting their highest level since December 11 at $4.593 earlier in the session.
Prices rose more than 11 per cent on Tuesday, marking the contract's sharpest daily rise since October 30. Meteorologists forecast a slight drop in temperatures nationwide through January 8, with heating degree days increasing from 358 on Tuesday to 377 on Wednesday, still below the normal level of 447, but forecasters anticipate colder weather in the days ahead.
"The market's a little on edge and that's why it's trading up the last day or so," said Thomas Saal, Senior Vice President for Energy Trading at StoneX Financial, adding that lower volumes due to the Christmas holiday have contributed to some volatility.
Trading volume remains thin at just 19,541 lots so far, reflecting light liquidity in the January 2026 contract during the holiday period. Average gas flows to the eight large US liquefied natural gas export plants have risen to 18.4 bcfd so far this month, up from a monthly record high of 18.2 bcfd in November.
"The LNG exports have helped support the market," Saal said.
LSEG projected average gas demand in the lower 48 states, including exports, would rise from 127.9 bcfd this week to 136.4 bcfd over the next two weeks. The forecast for next week was higher than LSEG's outlook on Tuesday.
Financial firm LSEG said average natural gas output in the lower 48 US states climbed to a record high of 109.8 billion cubic feet per day in December, surpassing November's monthly record of 109.6 bcfd. US energy firms this week added oil and natural gas rigs for the first time in three weeks, energy services firm Baker Hughes said in its closely followed report on Tuesday.
Dutch and British gas contracts rose slightly on Wednesday morning amid thin trading ahead of a long Christmas holiday as forecasts of a cold spell are expected to boost demand.
In other news, Russia's leading tanker group Sovcomflot received the first Russian-built ice-class tanker for liquefied natural gas from Zvezda Shipyard with plans to get two more next year, Interfax reported on Wednesday, citing the company's CEO
(Reporting by Anmol Choubey in Bengaluru; Editing by Lisa Shumaker and Matthew Lewis)
