US natgas prices ease on small daily output rise, trade tariff worries

By Scott DiSavino

April 11 (Reuters) - U.S. natural gas futures eased about 1% on Friday on a small increase in daily output and worries U.S. President Donald Trump's trade war with China could reduce economic growth and demand for energy around the world.

That small price decline came despite near record gas flows to liquefied natural gas (LNG) export plants.

Gas futures NGc1 for May delivery on the New York Mercantile Exchange fell 3.0 cents, or 0.8%, to settle at $3.527 per million British thermal units.

For the week, the contract fell about 8% after sliding about 6% last week.

Traders noted that meteorologists forecast that the weather would remain mostly mild through the end of April, which should allow energy firms to keep adding gas to storage as normal in coming weeks.

Gas stockpiles were currently about 4% below normal levels for this time of year after cold weather in January and February forced energy firms to pull large amounts of gas out of storage, including record amounts in January. EIA/GAS NGAS/POLL

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states fell to 105.9 billion cubic feet per day so far in April, down from a monthly record of 106.2 bcfd in March.

Analysts said that average decline, which was smaller than earlier in the week, was mostly due to normal spring pipeline maintenance in Texas and other parts of the country.

Looking forward, analysts said the roughly 14% drop in U.S. crude CLc1 futures over the past seven days due to uncertainty tied to Trump's on-again off-again trade tariffs could prompt energy firms to start cutting back on oil drilling. O/R

Any reduction in oil drilling in shale basins like the Permian in Texas and New Mexico and the Bakken in North Dakota could cut gas output associated with that production.

Meteorologists projected that temperatures in the Lower 48 states would remain mostly near normal through April 26.

With seasonally mild weather coming, LSEG forecast that average gas demand in the Lower 48, including exports, will fall from 108.3 bcfd this week to 100.1 bcfd next week and 97.8 bcfd in two weeks. The forecasts for this week and next were little changed from LSEG's outlook on Thursday.

The average amount of gas flowing to the eight big LNG export plants operating in the United States climbed from an all-time high of 15.8 bcfd in March to 16.1 bcfd so far in April on rising flows to Venture Global's VG.N 3.2-bcfd Plaquemines export plant that is under construction in Louisiana.

The United States became the world's biggest LNG supplier in 2023, surpassing Australia and Qatar, as surging global prices fed demand for more exports due in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

Gas was trading near a six-month low of around $11 per mmBtu at the Dutch Title Transfer Facility (TTF) TRNLTTFMc1 benchmark in Europe and at a eight-month low of around $13 at the Japan Korea Marker (JKM) JKMc1 benchmark in Asia. NG/EU

For gas data on the LSEG terminal type ENERGY in the search bar and then go to the GAS drop down and the NORTH AMERICA drop down.

For Interactive Map, type 'Interactive Map' in the box at upper left of the LSEG terminal

For graphics on Baker Hughes rig counts, see: http://graphics.thomsonreuters.com/15/rigcount/index.html

For next-day SNL U.S. gas prices, see: 0#SNL-NG

For next-day SNL U.S. power prices, see: 0#SNL-PWR

For U.S. natgas price and storage polls, see: NGAS/POLL

For U.S. nuclear power outages, see: NUKE/

For U.S. Northwest hydro power report, see: NWRFC

For U.S./Canada natural gas rig count vs Henry Hub futures price, see: http://tmsnrt.rs/2eT9k44

For the U.S. natural gas speed guide, see: USGAS

For the U.S. power speed guide, see: USPOWER

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NYMEX Henry Hub options and futures combined 0#3CFTC023651

NYMEX Henry Hub futures only 0#1CFTC023651

ICE Henry Hub options and futures combined 0#3CFTC023391

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NYMEX Henry Hub Penultimate gas swaps 0#3CFTC03565C