European LNG supply fears and a hot U.S. weather pattern are keeping natural gas futures bid even as production runs near record highs. August Nymex gas trades at $3.263, holding above its 50-day moving average, while a damaged Qatari export hub and a wide European storage gap keep buyers engaged.
August Nymex natural gas trades at $3.263, up 1.8 cents or 0.55% on Tuesday, as European LNG disruption fears and mid-July heat keep the bid alive. Production near record levels and comfortable storage cap the upside, but the market holds above its 50-day moving average at $3.187, and buyers are not giving that ground back.
Europe's storage gap pulls at U.S. cargoes
European gas prices hit a three-week high on Tuesday after an attack on a Qatari LNG carrier in the Strait of Hormuz reopened questions over how reliably Persian Gulf cargoes reach European buyers. European storage sat only about 50% full as of July 4 against a five-year seasonal average of 65%, a deficit wide enough to send utilities hunting for U.S. gas.
The Ras Laffan hub is why the Hormuz attack hit European pricing so hard. Qatar said earlier this year that attacks damaged roughly 17% of the facility's LNG export capacity, with repairs expected to take three to five years. The site handles about 20% of global liquefied natural gas supply, and the damage predates Tuesday's incident. LNG feedgas deliveries to U.S. export terminals totaled 18.1 billion cubic feet per day on Tuesday, down 7.6% from the prior week.
Heat is burning through the storage cushion
On the demand side, NatGasWeather is forecasting the southern two-thirds of the U.S. to stay hot to very hot through July 13, with highs in the 90s to 100 degrees and desert Southwest readings of 111 to 115. That air-conditioning load leans bullish for power-sector gas consumption.
Supply, however, keeps working against the bulls. BloombergNEF estimated lower-48 dry gas production at 110.2 billion cubic feet per day on Tuesday, up 1.7% from a year ago, while the Energy Information Administration raised its 2026 production forecast to 111.2 Bcf per day. Inventories sit 6.4% above the five-year seasonal average, a surplus that keeps every rally on a short leash.
Compression before the next move
The technical picture points to a coiling market. Natural gas advanced to a four-day high of $3.32 on Tuesday, and a rise above the trend high of $3.40 would quickly reach the 200-day moving average near $3.44. Analyst Bruce Powers notes the weekly chart now shows a double inside week, a range compression that may be followed by expansion and a momentum move. For now, futures need both the weather and the European LNG pull working together to close that storage gap.
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