US natgas slips to one-week low on oversupply of fuel in storage
Adds latest prices
Aug 16 (Reuters) -U.S. natural gas futures dropped more than 3% to a one-week low on Friday on forecasts for less hot weather than previously expected and oversupply of gas in storage, even though a federal weekly report showed a surprise draw in inventories this week.
Front-month gas futures NGc1 for September delivery on the New York Mercantile Exchange were down 7.4 cents, or about 3.4%, to settle at $2.123 per million British thermal units.
"Prices are mainly down because of the high levels of gas in storage and high production volumes. Lowered demand from LNG maintenance has also allowed storage to stay so high," said Ryan Parsons, an analyst at energy consulting firm Gelber and Associates.
However, "we are bullish on market prices through the end of 2024," Parsons added.
The U.S. Energy Information Administration on Thursday said utilities drew 6 billion cubic feet (bcf) of gas from inventories during the week ended Aug. 9, decreasing stockpiles to 3.264 trillion cubic feet (tcf). However, that was still above 7.2% the same week a year ago and 12.5% above the five-year average for the week.
Financial firm LSEG estimated 223 cooling degree days (CDDs) over the next two weeks, slightly lower than the 227 CDDs estimated on Thursday. The normal for this time of year is 186 CDDs.
LSEG forecast average gas demand in the Lower 48 U.S. states, including exports, to rise from 104.4 billion cubic feet per day (bcfd) this week to 106.5 bcfd next week.
LSEG said gas output in the Lower 48 U.S. has fallen to an average of 102.4 bcfd so far in August, down from 103.4 bcfd in July. That compares with a monthly record high of 105.5 bcfd in December 2023.
"This market is sending off some bearish vibes given its inability to advance off of a seemingly bullish EIA report that offered a highly unusual 6 bcf storage withdrawal for early August," energy advisory firm Ritterbusch and Associates said in a note.
"The decline reduced the surplus by almost 50 bcf to around 375 bcf and we expect a further reduction in the supply overhang during the next couple of months as the injection cycle winds down"
Meanwhile, Dutch and British gas wholesale prices were mixed on Friday morning as strong storage inventories helped ease fears of potential supply disruptions due to the war between Russia and Ukraine as well as tensions in the Middle East.NG/EU
Week ended Aug 16 forecast | Week ended Aug 9 Actual | Year ago Aug 2 | Five-year average Aug 2 | ||
U.S. weekly natgas storage change (bcf): | +33 | -6 | +25 | +38 | |
U.S. total natgas in storage (bcf): | 3,297 | 3,264 | 2,022 | 2,846 | |
U.S. total storage versus 5-year average | 12.5% | 13.0% | |||
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 | 2.16 | 2.18 | 2.65 | 2.66 | 3.60 |
Title Transfer Facility (TTF) TRNLTTFMc1 | 12.64 | 12.70 | 11.21 | 13.04 | 14.39 |
Japan Korea Marker (JKM) JKMc1 | 14.34 | 12.66 | 12.43 | 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 | 5 | 5 | 3 | 5 | 6 |
U.S. GFS CDDs | 223 | 227 | 211 | 186 | 178 |
U.S. GFS TDDs- | 228 | 232 | 214 | 191 | 184 |
LSEG U.S. Weekly GFS Supply and Demand Forecasts | |||||
Prior Week | Current Week | Next Week | Five-Year (2019-2023) Average For Month | ||
U.S. Supply (bcfd) | |||||
U.S. Lower 48 Dry Production | 101.8 | 101.8 | 102.2 | 96.3 | |
U.S. Imports from Canada | 7.7 | 7.6 | 7.6 | 7.3 | |
U.S. LNG Imports | 0.0 | 0.0 | 0.0 | 0.1 | |
Total U.S. Supply | 109.5 | 109.4 | 109.8 | 103.7 | |
U.S. Demand (bcfd) | |||||
U.S. Exports to Canada | 1.6 | 1.6 | 1.6 | 2.3 | |
U.S. Exports to Mexico | 7.3 | 7.2 | 7.2 | 6.1 | |
U.S. LNG Exports | 12.7 | 12.7 | 12.8 | 7.7 | |
U.S. Commercial | 4.5 | 4.5 | 4.6 | 4.5 | |
U.S. Residential | 3.7 | 3.8 | 3.8 | 3.4 | |
U.S. Power Plant | 43.9 | 45.3 | 47.1 | 43.0 | |
U.S. Industrial | 21.8 | 21.9 | 22.0 | 21.7 | |
U.S. Plant Fuel | 5.0 | 5.0 | 5.0 | 5.1 | |
U.S. Pipe Distribution | 2.2 | 2.2 | 2.3 | 2.2 | |
U.S. Vehicle Fuel | 0.1 | 0.1 | 0.1 | 0.1 | |
Total U.S. Consumption | 81.2 | 82.9 | 84.8 | 80.0 | |
Total U.S. Demand | 102.8 | 104.4 | 106.5 | 96.1 | |
N/A is Not Available | |||||
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam | Current Day % of Normal Forecast | Prior Day % of Normal Forecast | 2023 % of Normal Actual | 2022 % of Normal Actual | 2021 % of Normal Actual |
Apr-Sep | 74 | 74 | 83 | 107 | 81 |
Jan-Jul | 76 | 76 | 77 | 102 | 79 |
Oct-Sep | 77 | 78 | 76 | 103 | 81 |
U.S. weekly power generation percent by fuel - EIA | |||||
Week ended Aug 16 | Week ended Aug 9 | 2023 | 2022 | 2021 | |
Wind | 8 | 7 | 10 | 11 | 10 |
Solar | 6 | 5 | 4 | 3 | 3 |
Hydro | 6 | 6 | 6 | 6 | 7 |
Other | 1 | 1 | 2 | 2 | 2 |
Petroleum | 0 | 0 | 0 | 0 | 0 |
Natural Gas | 45 | 46 | 41 | 38 | 37 |
Coal | 17 | 18 | 17 | 21 | 23 |
Nuclear | 18 | 17 | 19 | 19 | 20 |
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) | |||||
Hub | Current Day | Prior Day | |||
Henry Hub NG-W-HH-SNL | 2.19 | 2.18 | |||
Transco Z6 New York NG-CG-NY-SNL | 1.74 | 1.59 | |||
PG&E Citygate NG-CG-PGE-SNL | 2.73 | 2.74 | |||
Eastern Gas (old Dominion South) NG-PCN-APP-SNL | 1.64 | 1.55 | |||
Chicago Citygate NG-CG-CH-SNL | 1.85 | 1.83 | |||
Algonquin Citygate NG-CG-BS-SNL | 1.78 | 1.72 | |||
SoCal Citygate NG-SCL-CGT-SNL | 1.97 | 1.97 | |||
Waha Hub NG-WAH-WTX-SNL | -1.21 | 0.46 | |||
AECO NG-ASH-ALB-SNL | 0.79 | 0.67 | |||
SNL U.S. Power Next-Day Prices ($ per megawatt-hour) | |||||
Hub | Current Day | Prior Day | |||
New England EL-PK-NPMS-SNL | 38.50 | 39.25 | |||
PJM West EL-PK-PJMW-SNL | 42.50 | 37.50 | |||
Ercot North EL-PK-ERTN-SNL | 55.00 | 47.50 | |||
Mid C EL-PK-MIDC-SNL | 39.25 | 34.00 | |||
Palo Verde EL-PK-PLVD-SNL | 36.00 | 31.50 | |||
SP-15 EL-PK-SP15-SNL | 34.75 | 30.50 |
Reporting by Anushree Mukherjee and Brijesh Patel in Bengaluru; editing by Jonathan Oatis
For gas data on LSEG's Eikon 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 Eikon 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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