Natural gas futures remained lower around midday Friday as traders weighed the approaching shoulder season decline in demand against strong LNG feedgas and hotter regional changes to the weather outlook. Shoulder season — the transitional period between summer cooling demand and winter heating demand — typically brings softer natural gas consumption as power sector load eases and storage operators aim to finish refills before withdrawals begin. Physical prices, meanwhile, were mixed.

Here's the latest:

• October futures slid 3.9 cents to $2.875/MMBtu around 11:45 a.m. ET.
• November dropped 4.0 cents to $3.031.

The modest pullback in the prompt month follows a week of choppy trade in which supportive factors — lean storage builds, hotter weather runs, and firm LNG feedgas demand from expanding export capacity — repeatedly collided with comfortable inventory levels and fading cooling demand, as reflected in the recent coverage below.

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Recent Coverage

• Natural Gas Futures Advance; California Supply Squeeze Jolts Midday Cash Above $8 — Natural gas futures pulled back from earlier highs around midday Thursday but remained supported by a lean storage build, including another hefty South Central salt withdrawal and stronger LNG feedgas.

• Hotter Forecasts, Supply Drop Fire Up Natural Gas Futures — Natural gas futures climbed sharply at midday Wednesday as warmer weather outlooks, lower production and stronger LNG feedgas demand provided support on the September contract's penultimate session in the lead.

• Shoulder Season Chill Hits Natural Gas Futures Despite Near-Term Hotter Forecast — Natural gas futures remained under pressure late Tuesday morning after the September contract briefly slipped below $2.700/MMBtu, with fading power sector demand and comfortable fall inventory expectations outweighing a somewhat hotter extended weather forecast.

• Early Gains Fade as Heat, Lower Production Support Natural Gas — Natural gas futures pared most of their early gains late Monday morning as ample inventories and easing power-sector demand tempered support from persistent heat and lower production.

• Weather Models Ratchet Up CCDs, Boosting Natural Gas Ahead of Weekend — Sharply hotter forecast runs helped September natural gas futures edge higher through midday Friday, teasing the prospect of a second straight week of modest gains for the prompt month.

• Midweek Momentum Fizzles for Amply Supplied Natural Gas Market — A comfortable supply outlook kept New York Mercantile Exchange (NYMEX) natural gas futures in negative territory on Thursday despite downwardly trending production and supportive heat in the forecast across much of the Lower 48.

Source: Natural Gas Intelligence