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US natural gas prices rise 1% to 8-week high on higher LNG feedgas, lower output



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Adds closing prices

By Scott DiSavino

Sept 6 (Reuters) -U.S. natural gas futures edged up about 1% to an eight-week high on Friday as the amount of gas flowing to liquefied natural gas (LNG)export plants rises and producers continue to curtail output.

That small price gain occurred despite bearish forecasts for cooler weather over the next two weeks than previously expected, which shouldreduce the amount of gas power generators burn to keep air conditioners humming.

Another factor that has weighed on gas prices for much of this year is the tremendous oversupply of gas left in storage after a mild winter.

There is still about 10% more gas in storage than normal for this time of year even though injections have been smaller than usual in 16 of the last 17 weeks. EIA/GAS NGAS/POLL

Analysts said those small builds happened mostly because several producers cut output this year after spot prices at the U.S. Henry Hub benchmark NG-W-HH-SNL fell to a 25-year low in the spring and have remained relatively low since.

Front-month gas futures NGc1 for October delivery on the New York Mercantile Exchange rose 2.1 cents, or 0.9%, to settle at $2.275 per million British thermal units (mmBtu), theirhighest close since July 12 for a second day in a row.

For the week, the front-month was up about 7% after gaining about 5% last week.


SUPPLY AND DEMAND

Financial firm LSEG said gas output in the Lower 48 U.S. states has slidto an average of 102.2 billion cubic feet per day (bcfd) so far in September, down from 103.2 bcfd in August.

On a daily basis, output was on track to drop by 2.1 bcfd over the last six days to a preliminary 11-week low of 101.7 bcfd on Friday. Analysts, however, noted that preliminary data was often revised later in the day.

Meteorologists forecast weather across the U.S. would remain mostly near normal through Sept. 9 before turning warmer than normal in the Sept. 10-21 period. Energy traders, however, noted that warmer-than-normal weather in mid-September would only average around 74 degrees Fahrenheit (23.3 degrees Celsius), down from an average of 79 F (26 C) in mid-August.

LSEG forecast average gas demand in the Lower 48, including exports, will fall from 102.5 bcfd this week to 100.5 bcfd for the next two weeks. The forecasts for this week and next were similar to LSEG's outlook on Thursday.

Gas flows to the seven big U.S. LNG export plants have risen to an average of 13.2 bcfd so far in September, up from 12.9 bcfd in August. That compares with a monthly record high of 14.7 bcfd in December 2023. On a daily basis, LNG feedgas was on track to reach a three-month high of 13.4 bcfd on Friday.

Looking ahead, Berkshire Hathaway Energy's 0.8-bcfd Cove Point LNG export plant in Maryland will likely be shutfor about three weeks of routine annual maintenance around Sept. 20, according to the plant's history and notices to customers.

The U.S. became the world's biggest LNG supplier in 2023, ahead of recent leaders Australia and Qatar, as much higher global prices feed demand for more exports due in part to supply disruptions and sanctions linked to Russia's invasion of Ukraine.

Gas prices were trading around $12 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe TRNLTTFMc1 and $14 at the Japan Korea Marker (JKM) benchmark in Asia JKMc1. NG/EU

Week ended Sep 6 Forecast

Week ended Aug 30 Actual

Year ago Sep 6

Five-year average

Sep 6


U.S. weekly natgas storage change (bcf):

+49

+13

+50

+67


U.S. total natgas in storage (bcf):

3,396

3,347

3,189

3,091


U.S. total storage versus 5-year average

9.9%

10.7%


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

2.26

2.25

2.70

2.66

3.60

Title Transfer Facility (TTF) TRNLTTFMc1

12.11

11.75

11.44

13.04

14.39

Japan Korea Marker (JKM) JKMc1

13.82

13.79

13.92

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

16

12

9

16

28

U.S. GFS CDDs

146

150

171

152

125

U.S. GFS TDDs

162

162

180

168

153

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

103.2

102.7

102.2

104.1

96.5

U.S. Imports from Canada

8.3

8.2

7.6

N/A

7.1

U.S. LNG Imports

0.0

0.0

0.0

0.0

0.0

Total U.S. Supply

111.6

110.9

109.8

N/A

103.6

U.S. Demand (bcfd)

U.S. Exports to Canada

1.7

1.9

1.9

N/A

2.3

U.S. Exports to Mexico

7.2

7.3

7.2

N/A

6.0

U.S. LNG Exports

12.6

13.1

13.4

13.1

8.2

U.S. Commercial

4.5

4.5

4.8

4.5

4.9

U.S. Residential

3.7

3.6

4.1

3.6

3.9

U.S. Power Plant

46.6

42.9

39.8

42.5

36.0

U.S. Industrial

21.9

21.8

22.0

21.5

21.7

U.S. Plant Fuel

5.1

5.1

5.0

5.1

5.1

U.S. Pipe Distribution

2.2

2.1

2.1

2.2

2.2

U.S. Vehicle Fuel

0.1

0.1

0.1

0.1

0.1

Total U.S. Consumption

84.2

80.2

78.0

79.5

80.0

Total U.S. Demand

105.7

102.5

100.5

N/A

90.4

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

75

83

107

81

Jan-Jul

76

76

77

102

79

Oct-Sep

78

78

76

103

81

U.S. weekly power generation percent by fuel - EIA

Week ended Sep 6

Week ended Aug 30

2023

2022

2021

Wind

6

7

10

11

10

Solar

5

5

4

3

3

Hydro

5

55

6

6

7

Other

1

1

2

2

2

Petroleum

0

0

0

0

0

Natural Gas

48

47

41

38

37

Coal

16

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

2.02

2.05


Transco Z6 New York NG-CG-NY-SNL

1.54

1.57


PG&E Citygate NG-CG-PGE-SNL

2.60

2.63


Eastern Gas (old Dominion South) NG-PCN-APP-SNL

1.53

1.52


Chicago Citygate NG-CG-CH-SNL

1.78

1.84


Algonquin Citygate NG-CG-BS-SNL

1.80

1.85


SoCal Citygate NG-SCL-CGT-SNL

2.05

2.09


Waha Hub NG-WAH-WTX-SNL

0.48

0.40




AECO NG-ASH-ALB-SNL

0.66

0.63



SNL U.S. Power Next-Day Prices ($ per megawatt-hour)


Hub

Current Day

Prior Day

New England EL-PK-NPMS-SNL

35.25

34.00



PJM West EL-PK-PJMW-SNL

27.00

32.00



Ercot North EL-PK-ERTN-SNL

18.50

25.25


Mid C EL-PK-MIDC-SNL

98.80

289.50




Palo Verde EL-PK-PLVD-SNL

105.25

160.50


SP-15 EL-PK-SP15-SNL

89.00

150.25




Reporting by Scott DiSavino; editing by Jonathan Oatis and Paul Simao

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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