US natgas prices hit 2-week low after Hurricane Milton knocks out power in parts of Florida
By Scott DiSavino
Oct 10 (Reuters) -U.S. natural gas futures fell about 2% to a two-week low on Thursday on forecasts for lower demand next week and expectations power generators will burn less gas after Hurricane Milton knocked out power to millions of homes and businesses in Florida.
Milton slammed into the west coast of Florida as a major storm on Wednesday night and swept across the central part of the state on Thursday.
The storm has already caused over 3.2 million homes and businesses to lose power in Florida. Those outages will add to the roughly 103,000 customers still without service in North Carolina and Georgia since Hurricane Helene moved inland after hitting Florida on Sept. 26.
In 2023, power generators in Florida burned a record 3.9 billion cubic feet per day of gas to keep the lights on for the state's roughly 11.5 million power customers, according to data from the U.S. Energy Information Administration and PowerOutage.us.
That means every 1 million customer outages reduces the need to burn around 0.3 bcfd of gas on average.
Front-month gas futures NGc1 for November delivery on the New York Mercantile Exchange fell 6.1 cents, or 2.3%, to $2.599 per million British thermal units at 8:02 a.m. EDT (1202 GMT), falling for a fifth day in a row and putting the contract on track for its lowest close since Sept. 26.
That would be the first time the contract dropped for five straight days since late August. During that time, it was down about 12%.
One factor that has weighed on futures prices all year has been low spot or next-day prices at the U.S. Henry Hub benchmark NG-W-HH-SNL in Louisiana.
The spot market has traded below front-month futures for 169 out of 195 trading days so far this year, according to data from financial company LSEG. Next-day prices at the Henry Hub were trading around $2.43 per mmBtu.
Analysts have noted that so long as spot prices remain far enough below front-month futures to cover margin and storage costs, traders should be able to lock in arbitrage profits by buying spot gas, storing it and selling a futures contract.
SUPPLY AND DEMAND
LSEG said average gas output in the Lower 48 U.S. states fell to 101.2 bcfd so far in October, down from 101.8 bcfd in September. That compares with a record 105.5 bcfd in December 2023.
LSEG forecast average gas demand in the Lower 48, including exports, will rise from 96.4 bcfd this week to 96.9 bcfd next week. The forecast for this week was higher than LSEG's outlook on Wednesday, while the forecast for next week was lower.
Gas flows to the seven big U.S. liquefied natural gas (LNG) export plants slid to an average of 12.4 bcfd so far in October, down from 12.7 bcfd in September. That compares with a monthly record high of 14.7 bcfd in December 2023.
That reduction was due mostly to the planned Sept. 20 shutdown of Berkshire Hathaway Energy's 0.8-bcfd Cove Point LNG export plant in Maryland for around three weeks of annual maintenance, which could end as soon as Oct. 10.
Week ended Oct 4 Forecast | Week ended Sep 27 Actual | Year ago Oct 4 | Five-year average Oct 4 | ||
U.S. weekly natgas storage change (bcf): | +71 | +55 | +85 | +96 | |
U.S. total natgas in storage (bcf): | 3,618 | 3,547 | 3,505 | 3,453 | |
U.S. total storage versus 5-year average | 4.8% | 5.7% | |||
Global Gas Benchmark Futures ($ per mmBtu) | Current Day | Prior Day | This Month Last Year | Prior Year Average 2023 | Five-Year Average (2018-2022) |
Henry Hub NGc1 | 2.62 | 2.66 | 3.15 | 2.66 | 3.60 |
Title Transfer Facility (TTF) TRNLTTFMc1 | 12.30 | 12.36 | 14.55 | 13.04 | 14.39 |
Japan Korea Marker (JKM) JKMc1 | 13.07 | 13.10 | 16.30 | 14.39 | 14.31 |
LSEG Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days | |||||
Two-Week Total Forecast | Current Day | Prior Day | Prior Year | 10-Year Norm | 30-Year Norm |
U.S. GFS HDDs | 99 | 106 | 107 | 105 | 136 |
U.S. GFS CDDs | 54 | 46 | 41 | 58 | 42 |
U.S. GFS TDDs | 153 | 152 | 148 | 163 | 178 |
LSEG U.S. Weekly GFS Supply and Demand Forecasts | |||||
Prior Week | Current Week | Next Week | This Week Last Year | Five-Year (2019-2023) Average For Month | |
U.S. Supply (bcfd) | |||||
U.S. Lower 48 Dry Production | 101.7 | 101.2 | 101.2 | 103.1 | 96.8 |
U.S. Imports from Canada | 7.6 | 8.0 | 7.4 | N/A | 7.1 |
U.S. LNG Imports | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
Total U.S. Supply | 109.3 | 109.2 | 108.6 | N/A | 103.9 |
U.S. Demand (bcfd) | |||||
U.S. Exports to Canada | 2.0 | 1.9 | 1.9 | N/A | 2.3 |
U.S. Exports to Mexico | 6.6 | 6.8 | 6.7 | N/A | 5.9 |
U.S. LNG Exports | 12.0 | 12.5 | 12.8 | 13.4 | 10.0 |
U.S. Commercial | 4.9 | 5.3 | 6.6 | 6.2 | 6.9 |
U.S. Residential | 4.1 | 4.8 | 7.5 | 6.5 | 7.3 |
U.S. Power Plant | 36.8 | 35.9 | 31.6 | 30.8 | 30.9 |
U.S. Industrial | 21.8 | 22.1 | 22.6 | 22.3 | 22.3 |
U.S. Plant Fuel | 5.0 | 5.0 | 5.0 | 5.0 | 5.0 |
U.S. Pipe Distribution | 2.0 | 2.0 | 2.0 | 2.0 | 2.0 |
U.S. Vehicle Fuel | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 |
Total U.S. Consumption | 74.8 | 75.2 | 75.5 | 72.9 | 74.5 |
Total U.S. Demand | 95.4 | 96.4 | 96.9 | N/A | 92.7 |
N/A is Not Available | |||||
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam | 2025 Current Day % of Normal Forecast | 2025 Prior Day % of Normal Forecast | 2024 % of Normal Actual | 2023 % of Normal Actual | 2022 % of Normal Actual |
Apr-Sep | 93 | 93 | 74 | 83 | 107 |
Jan-Jul | 86 | 87 | 76 | 77 | 102 |
Oct-Sep | 87 | 88 | 77 | 76 | 103 |
U.S. weekly power generation percent by fuel - EIA | |||||
Week ended Oct 11 | Week ended Oct 4 | 2023 | 2022 | 2021 | |
Wind | 8 | 8 | 10 | 11 | 10 |
Solar | 6 | 6 | 4 | 3 | 3 |
Hydro | 5 | 5 | 6 | 6 | 7 |
Other | 2 | 2 | 2 | 2 | 2 |
Petroleum | 0 | 0 | 0 | 0 | 0 |
Natural Gas | 45 | 45 | 41 | 38 | 37 |
Coal | 17 | 16 | 17 | 21 | 23 |
Nuclear | 18 | 18 | 19 | 19 | 20 |
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) | |||||
Hub | Current Day | Prior Day | |||
Henry Hub NG-W-HH-SNL | 2.43 | 2.39 | |||
Transco Z6 New York NG-CG-NY-SNL | 1.75 | 1.72 | |||
PG&E Citygate NG-CG-PGE-SNL | 4.30 | 4.67 | |||
Eastern Gas (old Dominion South) NG-PCN-APP-SNL | 1.61 | 1.61 | |||
Chicago Citygate NG-CG-CH-SNL | 2.25 | 2.50 | |||
Algonquin Citygate NG-CG-BS-SNL | 2.10 | 2.08 | |||
SoCal Citygate NG-SCL-CGT-SNL | 3.08 | 3.34 | |||
Waha Hub NG-WAH-WTX-SNL | 2.25 | 2.35 | |||
AECO NG-ASH-ALB-SNL | 1.18 | ||||
SNL U.S. Power Next-Day Prices ($ per megawatt-hour) | |||||
Hub | Current Day | Prior Day | |||
New England EL-PK-NPMS-SNL | 39.50 | 43.00 | |||
PJM West EL-PK-PJMW-SNL | 34.25 | 41.25 | |||
Ercot North EL-PK-ERTN-SNL | 28.00 | 28.00 | |||
Mid C EL-PK-MIDC-SNL | 68.60 | 40.00 | |||
Palo Verde EL-PK-PLVD-SNL | 52.00 | 54.75 | |||
SP-15 EL-PK-SP15-SNL | 48.75 | 49.25 |
Reporting by Scott DiSavino; Editing by Emelia Sithole-Matarise
For gas data on the LSEG terminal type ENERGY in the search bar and then go to the GAS drop down and the NORTH AMERICA drop down.
For Interactive Map, type 'Interactive Map' in the box at upper left of the LSEG terminal
For graphics on Baker Hughes rig counts, see: http://graphics.thomsonreuters.com/15/rigcount/index.html
For next-day SNL U.S. gas prices, see: 0#SNL-NG
For next-day SNL U.S. power prices, see: 0#SNL-PWR
For U.S. natgas price and storage polls, see: NGAS/POLL
For U.S. nuclear power outages, see: NUKE/
For U.S. Northwest hydro power report, see: NWRFC
For U.S./Canada natural gas rig count vs Henry Hub futures price, see: http://tmsnrt.rs/2eT9k44
For the U.S. natural gas speed guide, see: USGAS
For the U.S. power speed guide, see: USPOWER
To determine CFTC managed money net position add (NYMEX Henry Hub options and futures combined 3023651MNET) plus (ICE Henry Hub options and futures combined 3023391MNET divided by four) plus (NYMEX Henry Hub swaps options and futures combined 303565BMNET divided by four) plus (NYMEX Henry Hub penultimate gas swaps 303565CMNET divided by four)
NYMEX Henry Hub options and futures combined 0#3CFTC023651
NYMEX Henry Hub futures only 0#1CFTC023651
ICE Henry Hub options and futures combined 0#3CFTC023391
NYMEX Henry Hub swaps options and futures combined 0#3CFTC03565B
NYMEX Henry Hub Penultimate gas swaps 0#3CFTC03565C
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