November Nymex natural gas (NGX25) on Thursday closed down by -0.064 (-1.92%).

Nov nat-gas prices tumbled to a 1-week low on Thursday and settled sharply lower after weekly EIA nat-gas stockpiles rose more than expected.  The EIA reported that nat-gas inventories rose +80 bcf for the week ended October 3, above expectations of +77 bcf.  Losses in nat-gas prices were limited due to forecasts for cooler US temperatures, which could boost heating demand for nat-gas.   Forecaster Vaisala said Thursday that forecasts shifted cooler in the East for October 14-18 and shifted colder in the middle two-thirds of the US for October 19-23.

Higher US nat-gas production is a bearish factor for prices.  On Tuesday, the EIA raised its forecast for 2025 US nat-gas production by +0.5% to 107.14 bcf/day from September's estimate of 106.60 bcf/day.  US nat-gas production is currently near a record high, with active US nat-gas rigs recently posting a 2-year high.

US (lower-48) dry gas production on Thursday was 107.0  bcf/day (+4.4% y/y), according to BNEF.  Lower-48 state gas demand on Thursday was 71.6 bcf/day (+0.2% y/y), according to BNEF.  Estimated LNG net flows to US LNG export terminals on Thursday were 15.8 bcf/day (+0.8% w/w), according to BNEF.

As a supportive factor for gas prices, the Edison Electric Institute reported Wednesday that US (lower-48) electricity output in the week ended October 4 rose +2.91% y/y to 80,972 GWh (gigawatt hours), and US electricity output in the 52-week period ending October 4 rose +2.89% y/y to 4,274,208 GWh.

The consensus is that Thursday's weekly EIA nat-gas inventories will climb by +77 bcf for the week ended October 3, below the five-year average for this time of year of +94 bcf.

Thursday's weekly EIA report was bearish for nat-gas prices since nat-gas inventories for the week ended October 3 rose +80 bcf, above the market consensus of +77 bcf but below the 5-year weekly average of +94 bcf.  As of October 3, nat-gas inventories were up +0.3% y/y, and were +4.5% above their 5-year seasonal average, signaling adequate nat-gas supplies.  As of October 5, gas storage in Europe was 83% full, compared to the 5-year seasonal average of 90% full for this time of year.

Baker Hughes reported last Friday that the number of active US nat-gas drilling rigs in the week ending October 3 rose by +1 to 118 rigs, slightly below the 2-year high of 124 rigs posted on August 1.  In the past year, the number of gas rigs has risen from the 4.5-year low of 94 rigs reported in September 2024.