-- US natural gas futures reversed earlier gains by midday Monday, pressured by weak demand and strong supply that outweighed an early geopolitical risk premium.
The front-month Henry Hub contract and the continuous futures both fell 0.38% to $2.64 per million British thermal units.
Prices initially rose alongside crude oil on renewed concerns over energy flows through the Persian Gulf, after US President Donald Trump issued an order to blockade the Strait of Hormuz following failed peace talks with Iran over the weekend, Bloomberg reported. The rally faded as supply-demand fundamentals reasserted control.
Weather expectations also shifted during the session. US natural gas futures had earlier been supported by weather forecasts and geopolitical tensions, but Bloomberg said forecasts changed again after Friday's close, which marked the lowest level in 17 months.
Commodity Weather Group said above-normal temperatures across the eastern two-thirds of the US are expected to ease back toward seasonal norms starting Apr. 18 and continue through Apr. 27.
Supply remained elevated. Lower 48 dry gas production on Monday was 118.8 billion cubic feet per day, or about 2.4% above year-ago levels, Bloomberg said.
Demand indicators weakened further. Bloomberg estimated total US demand at about 4% below year-ago levels. NRG Energy said natural gas demand fell last week as warmer temperatures spread across the country, with consumption dropping from 90 Bcf/d to 75 Bcf/d.
NRG Energy said residential and commercial demand accounted for most of the decline, while other sectors were relatively flat.
On the export side, BNEF said LNG feedgas demand was 19.9 Bcf/d, up 1.5% from the previous week.