Sept 30 (Reuters) - U.S. natural gas futures eased about 1% on Monday on a small increase in output over the weekend and forecasts for less demand over the next two weeks than previously expected.
That small output increase came as some drillers restarted their Gulf of Mexico production now that Hurricane Helene passed through the area.
The decline in demand, meanwhile, was due in part to a reduction in the amount of gas power generators will likely burn with over two million homes and businesses still without power in the U.S. Southeast and Midwest after Helene battered the region late last week.
Front-month gas futures for November delivery on the New York Mercantile Exchange fell 1.9 cents, or 0.7%, to $2.883 per million British thermal units at 9:02 a.m EDT (1302 GMT). On Friday the contract closed at its highest since June 18.
Despite the small decline, the front-month remained in technically overbought territory for a second day in a row for the first time since May.
For the month, the contract was up about 36%, the most in a month since July 2022.
For the quarter, the front-month was up about 11% after jumping 48% last quarter.
With gas futures up about 45% over the past five weeks, speculators boosted their net long futures and options positions on the New York Mercantile and Intercontinental Exchanges for a fourth week in a row to their highest since early July, according to the U.S. Commodity Futures Trading Commission's Commitments of Traders report.
In Canada, meanwhile, next-day gas prices at the AECO hub in Alberta fell to 4 cents per mmBtu, their lowest since hitting a record low of around 2 cents in August 2022, according to data from financial firm LSEG going back to 1993.
SUPPLY AND DEMAND
LSEG said gas output in the Lower 48 U.S. states fell to an average of 102.1 bcfd so far in September, down from 103.2 bcfd in August. That compares with a record 105.5 bcfd in December 2023.
The average output for September, however, was higher than seen last week as some Gulf of Mexico production returned to service.
LSEG forecast average gas demand in the Lower 48 states, including exports, will rise from 95.9 bcfd this week to 96.6 bcfd next week. Those forecasts were lower than LSEG's outlook on Friday.
Gas flows to the seven big U.S. liquefied natural gas (LNG) export plants eased to an average of 12.7 bcfd so far in September, down from 12.9 bcfd in August. 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.
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 a six-week high of $13 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe and a one-week high of $13 at the Japan Korea Marker (JKM) benchmark in Asia .
|
Week ended Sep 27 |
Week ended Sep 20 Actual |
Year ago Sep 27 |
Five-year average |
||
|
U.S. weekly natgas storage change (bcf): |
+60 |
+47 |
+87 |
+98 |
|
|
U.S. total natgas in storage (bcf): |
3,552 |
3,492 |
3,420 |
3,357 |
|
|
U.S. total storage versus 5-year average |
5.8% |
7.1% |
|||
|
Global Gas Benchmark Futures ($ per mmBtu) |
Current Day |
Prior Day |
This Month Last Year |
Prior Year Average 2023 |
Five-Year Average (2018-2022) |
|
Henry Hub |
2.93 |
2.90 |
2.70 |
2.66 |
3.60 |
|
Title Transfer Facility (TTF) |
12.68 |
12.47 |
11.44 |
13.04 |
14.39 |
|
Japan Korea Marker (JKM) |
13.21 |
13.19 |
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 |
50 |
51 |
65 |
77 |
94 |
|
U.S. GFS CDDs |
94 |
97 |
75 |
75 |
61 |
|
U.S. GFS TDDs |
144 |
148 |
130 |
152 |
155 |
|
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 |
101.8 |
102.2 |
102.2 |
102.3 |
96.5 |
|
U.S. Imports from Canada |
7.9 |
7.6 |
7.4 |
N/A |
7.1 |
|
U.S. LNG Imports |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|
Total U.S. Supply |
109.7 |
109.9 |
109.6 |
N/A |
103.6 |
|
U.S. Demand (bcfd) |
|||||
|
U.S. Exports to Canada |
1.9 |
2.0 |
1.9 |
N/A |
2.3 |
|
U.S. Exports to Mexico |
6.2 |
6.1 |
6.8 |
N/A |
6.0 |
|
U.S. LNG Exports |
12.3 |
12.4 |
13.0 |
12.7 |
8.2 |
|
U.S. Commercial |
4.8 |
4.9 |
5.3 |
5.0 |
4.9 |
|
U.S. Residential |
4.0 |
4.0 |
4.7 |
4.2 |
3.9 |
|
U.S. Power Plant |
40.2 |
37.2 |
35.6 |
35.4 |
36.0 |
|
U.S. Industrial |
21.9 |
21.9 |
22.1 |
21.7 |
21.7 |
|
U.S. Plant Fuel |
5.0 |
5.0 |
5.0 |
5.0 |
5.1 |
|
U.S. Pipe Distribution |
2.1 |
2.0 |
2.0 |
2.0 |
2.2 |
|
U.S. Vehicle Fuel |
0.1 |
0.1 |
0.1 |
0.1 |
0.1 |
|
Total U.S. Consumption |
78.1 |
75.3 |
74.9 |
73.4 |
80.0 |
|
Total U.S. Demand |
98.5 |
95.9 |
96.6 |
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 |
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 Oct 4 |
Week ended Sep 27 |
2023 |
2022 |
2021 |
|
|
Wind |
7 |
7 |
10 |
11 |
10 |
|
Solar |
4 |
5 |
4 |
3 |
3 |
|
Hydro |
5 |
5 |
6 |
6 |
7 |
|
Other |
1 |
1 |
2 |
2 |
2 |
|
Petroleum |
0 |
0 |
0 |
0 |
0 |
|
Natural Gas |
44 |
46 |
41 |
38 |
37 |
|
Coal |
18 |
18 |
17 |
21 |
23 |
|
Nuclear |
20 |
18 |
19 |
19 |
20 |
|
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) |
|||||
|
Hub |
Current Day |
Prior Day |
|||
|
Henry Hub |
2.53 |
2.64 |
|||
|
Transco Z6 New York |
1.28 |
1.23 |
|||
|
PG&E Citygate |
3.05 |
3.00 |
|||
|
Eastern Gas (old Dominion South) |
1.32 |
1.21 |
|||
|
Chicago Citygate |
2.35 |
2.52 |
|||
|
Algonquin Citygate |
1.55 |
1.65 |
|||
|
SoCal Citygate |
2.55 |
2.47 |
|||
|
Waha Hub |
0.96 |
1.39 |
|||
|
AECO |
0.04 |
0.07 |
|||
|
SNL U.S. Power Next-Day Prices ($ per megawatt-hour) |
|||||
|
Hub |
Current Day |
Prior Day |
|||
|
New England |
32.25 |
36.50 |
|||
|
PJM West |
43.25 |
37.00 |
|||
|
Ercot North |
21.50 |
25.25 |
|||
|
Mid C |
49.25 |
50.50 |
|||
|
Palo Verde |
29.50 |
36.00 |
|||
|
SP-15 |
28.25 |
34.75 |
Reporting by Scott DiSavino; Editing by Andrea Ricci
Source: Reuters