U.S. natural gas futures fell on Aug. 31, retreating from an over nine-month high scaled in the last session, as weather forecasts turned cooler, although prices registered their best month since 2009 on a surge in LNG exports.

Front-month gas futures fell 2.7 cents, or 1%, to settle at $2.630 per million British thermal units. Prices had touched their highest since early November at $2.743 on Aug. 28.

"There is a weather change. It is going to be cooler-than-normal, which is going to reduce demand," Phil Flynn, a senior analyst at Price Futures Group in Chicago said, adding that less-than-anticipated damage from Hurricane Laura and slower exports because of the storms is also weighing on prices.

However, for the month, prices were up about 46%, the most since September 2009, propped up by a surge in LNG exports and on concerns about tropical storms. 

Refinitiv data indicated 151 cooling degree days (CDDs) in the Lower 48 states over the next two weeks, declining from 175 CDDs in the prior day. CDDs measure the number of degrees a day's average temperature is above 65 degrees Fahrenheit (18 degrees Celsius) and are used to estimate demand to cool homes and businesses.

Prices had earlier declined as much as 6%, but the market pared losses on concerns of another tropical disturbance which is beginning to form in the Caribbean and could cap production, advisory firm Ritterbusch said in a note.

U.S. output rose to 87 Bcf/d on Aug. 30 as many wells in the Gulf resumed operations after Laura, preliminary data from Refinitiv showed.

U.S. Gulf Coast offshore producers on Aug. 30 reported 50%, or 1.35 Bcf, of natural gas output was offline due to the storm.

Demand in the Lower 48 states is expected to decline as the weather turns cooler, falling from 85.8 Bcf/d this week to 82 Bcf/d in the next, according to Refinitiv.

Source: Reuters

U.S. Natgas Storage  (Bcf)

 Week ended Aug. 28
 Week ended Aug. 21
 Year ago Aug. 28 Five-year average Aug. 28
 +37  +45  +77  +66
Source: Retuers

 SNL U.S. Natural Gas
Next-day Prices ($/MMBtu)

 Hub Current Day Prior Day
 Henry Hub $2.46 $2.52
 Transco z6 New York $1.07  $1.62
 PG&E Citygate $3.54 $3.56
 Dominion South $1.04 $1.20
Chicago Citygate $2.17 $2.28
Algonquin Citygate $1.22 $1.35
SoCal Citygate $3.79 $4.05
Waha Hub $1.36 $1.07