Sept 16 (Reuters) - U.S. natural gas futures rose 3% on Monday, buoyed by forecasts for higher demand over the next week, while the market also factored in production cuts due to last week's storm.

Front-month gas futures for October delivery on the New York Mercantile Exchange rose 6.8 cents or 3% to settle at $2.373 per million British thermal units (mmBtu).

"We believe that the market is really going to be focused on the inventory this week as well as the weather going forward. If this market is going to find support, it's gonna need help from Mother Nature and you usually don't get a lot of that support in the shoulder season," said Phil Flynn, an analyst at Price Futures Group.

Last week, the U.S. Energy Information Administration said utilities added 40 billion cubic feet (bcf) of gas into storage during the week ended Sept. 6. That was lower compared with an injection of 50 bcf during the same week a year ago and a five-year average (2019-2023) increase of 67 bcf for this time of year. EIA/GASNGAS/POLL

"After Hurricane Francine, the productions been off for a while, but because it's shoulder season the market isn't as concerned, but it definitely should cut into our supply surplus," Flynn added.

More than 12% of crude production and 16% of natural gas output in the U.S. Gulf of Mexico were still offline in the aftermath of Hurricane Francine, the U.S. Bureau of Safety and Environmental Enforcement (BSEE) said on Monday. The U.S. Gulf of Mexico accounts for about 15% of all domestic oil production and 2% of natural gas output, according to federal data.

Dutch and British wholesale gas prices declined on higher forecast temperatures this week and supply outages easing.

Meanwhile, the fifth cargo of liquefied natural gas from Russia's Arctic LNG 2 was picked up by a vessel managed by a company under U.S. sanctions, according to ship tracking data.

Financial firm LSEG said gas output in the Lower 48 U.S. states slid to an average of 102.1 billion cubic feet per day (bcfd) so far in September, down from 103.2 bcfd in August.

Meanwhile, LSEG forecast average gas demand in the Lower 48, including exports, rose from 99.6 bcfd last week to 100.2 bcfd this week and is seen rising to 100.9 bcfd next week.

LSEG forecast average gas supply in the Lower 48, including exports, unchanged this and next week at 101.9 bcfd.

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https://www.reuters.com/business/energy/us-natgas-rises-3-higher-demand-outlook-output-cut-2024-09-16/