Power generation still at historically high levels

Benchmark natural gas prices extended a summertime rally over the past week, though moderating temperatures in much of the U.S. led to slower residential air conditioning demand, the Energy Department said.

During the week ended Aug. 1, nationwide power-related consumption fell 3.4% from the previous week, while residential and commercial demand fell 1.2%, the Energy Information Administration said in a report.

“After extremely hot temperatures last month receded… gas demand for power generation decreased below last year’s levels,” the EIA, the Energy Department’s statistical arm, said in the report. Despite the recent decline, “power burn this summer has been at historically high levels, partly because of a much warmer-than-normal July,” the EIA said.

Henry Hub gas was $3.20 per million British thermal units as of Aug. 1, up 1 cent from a week earlier, according to EIA. In NYMEX futures trading, September futures fell over 25 cents on Aug. 2 to settle at $2.92, after touching $3.277, the highest price since January, earlier in the week.

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