Market Summary


July concluded with the first hurricane of the 2023 season, Tropical Storm Don, which intensified into a Category 1 hurricane on July 22. However, its designation as a hurricane was brief; it returned to tropical storm status on July 23. On August 10, the Climate Prediction Center (part of NOAA) issued an El Nino Advisory. This expects the Pacific Ocean El Niño to continue through the Northern Hemisphere winter, as indicated by above-average sea surface temperatures. The statement emphasizes that a strong El Niño does not necessarily mean strong local impacts. NOAA’s 16-day forecast predicts warm temperatures on both U.S. coasts, cooler temperatures in the Midwest, with a shift expected towards the end of August. The U.S. weather was 17 percent cooler for the week ending August 5 and 0.5 percent cooler in July than last year, but 16 percent warmer than normal.


The EIA Natural Gas Weekly Update reported a decrease in natural gas demand to 74.4 Bcf per day for the week ending August 9, down 3.4 Bcf per day from the same week last year. This decrease was primarily due to a 2.1 Bcf per day reduction in demand from the power generation sector. Overall demand has climbed year-to-date, bolstered by the strength of gas flows to the power sector and for export, and offset by declines in residential and commercial and industrial demand.

According to the August 9 edition of Today in Energy, homes in the Midwest consumed 34 percent more natural gas than the national average in 2020. This percentage represents an increase of 19.5 MMBtu from the national average of 56.6 MMBtu to the Midwest consumption level of 76.1 MMBtu.


Dry gas production is up 2.9 percent from the same week in 2022. The EIA reported a slight decrease in dry gas production week-over-week, falling a total of 0.3 Bcf per day to 102.2 Bcf per day for the week ending August 9.

Pipeline Imports and Exports

According to the EIA, imports from Canada decreased slightly by 0.2 Bcf per day week-over-week to 5.9 Bcf per day for the report week ending August 9. While imports from Canada decreased, exports to Mexico remained unchanged week-over-week at 6.1 Bcf per day.

LNG Markets

European prices for natural gas have surged amid supply fears brought upon by the possibility of labor strikes in Australia that could disrupt global LNG supplies. European prices at the TTF have increased 40 percent since June, according to reporting from CNBC, following news of a potential LNG facility strike at major plants in Australia. TTF prices closed at $11.02 as of August 14, but were climbing on intraday markets at the time of this writing. The July 31 edition of Today in Energy shows record-setting levels of natural gas delivered to U.S. LNG export facilities in the first six months of 2023, deliveries averaging 12.8 Bcf per day, or 4% more than the same six-month period in 2022.

Working Gas in Underground Storage

EIA reported 29 Bcf storage build to 3,030 Bcf of working gas inventories for the week ending August 4. Stocks are 11 percent higher than the five-year average and 21 percent higher year-over-year. The refill rate has been one percent higher than the five-year average. Notably, regional stocks are all in double-digit percentage surplus relative to the five-year average except the Pacific region, which is 11.7 percent below the five-year average.

Rig Count

Baker Hughes reported a decline of five rigs in the U.S. rig count, bringing the total to 654 for the week ending August 11. The weekly net decline was entirely comprised of gas rigs. The Permian basin fell by four rigs, two dropped in the Marcellus, and one gas rig increased the count in the Eagle Ford.

Reported Prices

Prompt-month pricing at Henry Hub continues its struggle to rise above $3 per MMBtu. September futures are currently trading at $2.62 per MMBtu. Looking ahead on the futures strip, futures rise as high as 4.00 per MMBtu for the January 2024 contract before falling back again as the winter contracts progress. The modest pricing position for gas commodity reflects demand growth matched by an even faster-growing supply position in terms of rising dry gas production and above-average working gas inventories.

For questions please contact Juan Alvarado | or Morgan Hoy | mhoy@aga.orgTo be added to the distribution list for this report, please notify Lucy Castaneda-Land |


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