U.S. natgas futures rise 3% to one-week high on colder forecasts
15/02/2022 13:49
Feb 15 (Reuters) - U.S. natural gas futures climbed 3% to a one-week high on Tuesday on forecasts for much
colder weather and higher heating demand over the next two weeks than previously expected.
Traders noted the price increase came despite the continued slow return of U.S. production from cold
weather-related reductions over the past month, and an 8% drop in European TRNLTTFMc1 gas futures as some
Russian troops return to base, easing tensions with Ukraine. urn:newsml:reuters.com:*:nL8N2UQ28Q
Over the past month or so, the U.S. has worked with other nations to ensure that gas supplies—mostly from
liquefied natural gas (LNG)—would keep flowing to Europe in case Russia cuts off supplies to the rest of the
continent.
If Russia invades Ukraine, the U.S. and Europe have said they would sanction Russia, and Russia would
likely cut at least some gas exports to Europe. Russia provides around 30%-40% of Europe's gas supplies,
totaling about 16.3 billion cubic feet per day (bcfd) in 2021. NG/GB urn:newsml:reuters.com:*:nL8N2RT64U urn:newsml:reuters.com:*:nL1N2U52QX
Since the start of the year, however, the U.S. gas market has focused more on changes in U.S. weather and
domestic supply and demand, rather than what is happening around the world. So far in 2022, U.S. gas followed
European prices only about a third of the time versus two-thirds in the fourth quarter of 2021.
U.S. front-month gas futures NGc1 for March delivery rose 12.5 cents, or 3.0%, to $4.320 per million
British thermal units (mmBtu) at 8:25 a.m. ET (1325 GMT), putting the contract on track for its highest close
since Feb. 4.
In the spot market, frigid weather and high heating demand in the U.S. Northeast this year have kept
next-day power and gas prices in New York NG-CG-NY-SNL and New England NG-CG-BS-SNL EL-PK-NPMS-SNL at or
near their highest levels since January 2018. urn:newsml:reuters.com:*:nL1N2UL2PZ urn:newsml:reuters.com:*:nL1N2TR0X4 urn:newsml:reuters.com:*:nL1N2TN1OX
Data provider Refinitiv said average output in the U.S. Lower 48 states fell from a record 97.3 bcfd in
December to 94.0 bcfd in January and 92.5 bcfd so far in February as cold weather froze wells in several
producing regions. urn:newsml:reuters.com:*:nL1N2TJ23J
On a daily basis, however, output soared to 95.2 bcfd on Feb. 11, its highest since Jan. 1. Output has
been rising almost daily since it dropped to 86.3 bcfd during a winter storm on Feb. 4, its lowest since
February 2021.
Even though the weather is forecast to be colder than previously expected, it is still on track to be less
cold next week than this week with the coming of spring-like weather in some areas.
Refinitiv projected average U.S. gas demand, including exports, would drop from 122.8 bcfd this week to
118.8 bcfd next week. Those forecasts were higher than Refinitiv's outlook on Monday due to the expected
colder weather.
The amount of gas flowing to U.S. LNG export plants rose to an average of 12.7 bcfd so far in February,
which would top January's monthly record of 12.4 bcfd, as liquefaction trains at Venture Global LNG's
Calcasieu Pass export plant in Louisiana enter service.
A tanker arrived at Calcasieu on Feb. 7 and will likely leave with the plant's first cargo soon.
urn:newsml:reuters.com:*:nL1N2UP1JF urn:newsml:reuters.com:*:nL1N2UM1CA urn:newsml:reuters.com:*:nL1N2UI1T5
Week ended Week ended Year ago Five-year
Feb. Feb. 4 Feb. 11 average
11(Forecast) (Actual) Feb. 11
U.S. weekly natgas storage change (bcf): -202 -222 -227 -154
U.S. total natgas in storage (bcf): 1,899 2,101 2,315 2,162
U.S. total storage versus 5-year average -12.2% -9.3%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
Last Year Average Average
2021 (2017-2021)
Henry Hub NGc1 4.36 4.20 2.92 3.73 2.89
Title Transfer Facility (TTF) TRNLTTFMc1 24.60 26.64 6.14 16.04 7.49
Japan Korea Marker (JKM) JKMc1 24.89 24.57 7.36 18.00 8.95
Refinitiv Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days
Two-Week Total Forecast Current Day Prior Day Prior Year 10-Year 30-Year
Norm Norm
U.S. GFS HDDs 391 353 454 383 376
U.S. GFS CDDs 6 6 8 8 6
U.S. GFS TDDs 397 359 462 391 382
Refinitiv U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Week Next Week This Week Five-Year
Last Year Average For
Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production 91.3 94.9 95.2 76.1 83.3
U.S. Imports from Canada 9.3 9.0 9.0 10.7 8.9
U.S. LNG Imports 0.2 0.2 0.0 0.7 0.2
Total U.S. Supply 100.8 104.0 104.3 87.5 92.4
U.S. Demand (bcfd)
U.S. Exports to Canada 2.4 2.9 3.0 1.9 2.7
U.S. Exports to Mexico 5.4 5.2 5.6 4.4 4.8
U.S. LNG Exports 12.5 13.0 12.8 5.0 4.7
U.S. Commercial 17.9 16.7 15.4 22.5 15.6
U.S. Residential 30.1 27.2 25.6 39.5 26.1
U.S. Power Plant 28.2 25.3 24.3 33.8 26.3
U.S. Industrial 25.7 25.0 24.6 27.5 24.5
U.S. Plant Fuel 4.5 4.7 4.7 4.7 4.6
U.S. Pipe Distribution 2.9 2.7 2.6 2.7 3.1
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 109.4 101.7 97.5 130.8 100.3
Total U.S. Demand 129.7 122.8 118.8 142.1 112.5
U.S. weekly power generation percent by fuel - EIA
Week ended Week ended Week ended Week ended Week ended
Feb 18 Feb 11 Feb 4 Jan 28 Jan 21
Wind 10 12 11 9 11
Solar 3 3 2 2 2
Hydro 7 7 6 7 7
Other 2 2 2 2 2
Petroleum 1 1 1 1 1
Natural Gas 33 33 33 35 33
Coal 24 23 25 26 25
Nuclear 21 20 19 19 19
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub NG-W-HH-SNL 4.05 4.04
Transco Z6 New York NG-CG-NY-SNL 7.00 11.64
PG&E Citygate NG-CG-PGE-SNL 4.55 4.25
Dominion South NG-PCN-APP-SNL 3.75 3.50
Chicago Citygate NG-CG-CH-SNL 3.84 3.75
Algonquin Citygate NG-CG-BS-SNL 22.35 13.75
SoCal Citygate NG-SCL-CGT-SNL 3.91 3.80
Waha Hub NG-WAH-WTX-SNL 3.48 3.40
AECO NG-ASH-ALB-SNL 3.22 2.97
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day
New England EL-PK-NPMS-SNL 183.00 45.50
PJM West EL-PK-PJMW-SNL 25.00 22.25
Ercot North EL-PK-ERTN-SNL 21.50 25.25
Mid C EL-PK-MIDC-SNL 28.75 29.25
Palo Verde EL-PK-PLVD-SNL 27.50 37.75
SP-15 EL-PK-SP15-SNL 30.00 38.75
(Reporting by Scott DiSavino; Editing by Amy Caren Daniel)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging:
scott.disavino.thomsonreuters.com@reuters.net))
((For Refinitiv type ENERGY in Eikon search bar and then go to the GAS dropdown and the NORTH AMERICA dropdown or see: cpurl://apps.cp./cms/?pageid=usa-gas
For Interactive Map, type 'Interactive Map' in the box at upper left of the Reuters 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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