Is Cooler Weather Still Undermining Bullish Setups?
Weather remains a primary drag on sentiment. Updated GFS and EC models have steadily trimmed cooling demand expectations, removing five cooling degree days from prior forecasts. While the southern U.S. remains warm, projected mild conditions across the Midwest and Northeast have weighed heavily on power burn outlooks. Vaisala now sees widespread moderation into early August, diminishing the odds of a weather-driven rebound in the near term.
Does Rising Production Continue to Cap Upside?
Production remains a stubborn headwind. Lower-48 dry gas output topped 107 Bcf/day last week, climbing nearly 3% year-over-year. Rig counts also surged, with Baker Hughes showing a jump to 117 by Friday and reaching 122 on the final trading day—the highest since 2023. While producers may be hedging future prices or positioning for margin improvements, the short-term result is a saturated market unlikely to find footing on fundamentals alone.
LNG Exports Falter as Global Demand Stalls
Export demand has provided little relief. LNG feedgas flows dropped to 14.7 Bcf/day last week, a 5.4% weekly decline. European storage levels sit at 66% capacity, trailing the five-year average of 74%, suggesting limited urgency for imports. Without a rebound in international demand, LNG exports are unlikely to offer meaningful upside support during the current injection window.
Will Technicals Determine the Next Move?