US natgas prices jump 5% to 8-month high on small storage build, lower output (updated)
05/10/2023 15:31
(Adds EIA storage report, latest prices)
Oct 5 (Reuters) - U.S. natural gas futures jumped about 5% to an eight-month high on Thursday on a smaller-than-expected
storage build, a drop in output and forecasts for seasonally cooler weather that should boost heating demand in coming weeks.
The U.S. Energy Information Administration (EIA) said utilities added 86 billion cubic feet (bcf) of gas into storage during
the week ended Sept. 29.
That was lower than the 92-bcf build analysts forecast in a Reuters poll and compares with an increase of 126 bcf in the same
week last year and a five-year (2018-2022) average increase of 103 bcf. EIA/GAS NGAS/POLL
Last week's increase boosted stockpiles to 3.445 trillion cubic feet (tcf), or 5.3% above the five-year average of 3.273 tcf
for the time of year.
Front-month gas futures NGc1 for November delivery on the New York Mercantile Exchange rose 14.3 cents, or 4.8%, to $3.105
per million British thermal units (mmBtu) at 10:37 a.m. EDT (1437 GMT), putting the contract on track for its highest close since
Jan. 24.
That price jump pushed the front-month into technically overbought territory, with a relative strength index (RSI) above 70
for the first time since late September.
Financial firm LSEG said average gas output in the lower 48 U.S. states slid to 102.2 billion cubic feet per day (bcfd) so
far in October, down from 102.9 bcfd in September and a monthly record high of 103.1 bcfd in August.
On a daily basis, output dropped by 1.4 bcfd over the past two days to a preliminary 14-week low of 101.2 bcfd on Thursday.
Energy analysts, however, have said that preliminary data is often revised later in the day.
Meteorologists forecast the weather in the lower 48 states would remain mostly near normal through Oct. 20.
LSEG forecast U.S. gas demand, including exports, would rise from 94.8 bcfd this week to 95.5 bcfd next week as the normal
seasonal cooling of the weather boosts heating demand. The forecast for this week was lower than LSEG's outlook on Wednesday,
while the forecast for next week was higher.
RISING EXPORTS
Pipeline exports to Mexico rose to an average of 7.3 bcfd so far in October, up from a record 7.2 bcfd in September, according
to LSEG data.
Analysts expect exports to Mexico to rise even higher in coming months once New Fortress Energy's NFE.O plant in Altamira
starts pulling in U.S. gas to turn into liquefied natural gas (LNG) for export.
Gas flows to the seven big U.S. LNG export plants slid to 12.4 bcfd so far in October, down from 12.6 bcfd in September and a
record high of 14.0 bcfd in April.
Energy traders said they expected Berkshire Hathaway Energy's 0.8-bcfd Cove Point facility in Maryland to exit a maintenance
outage over the next week or so based in part on company notices to customers that some pipeline work was expected to be completed
on Oct. 4. Cove Point shut around Sept. 20. Analysts at LSEG have said the plant usually shuts for about three weeks of
maintenance each autumn.
The U.S. is on track to become the world's biggest LNG supplier in 2023, ahead of recent leaders Australia and Qatar. Much
higher global prices have fed demand for U.S. exports due to supply disruptions and sanctions linked to the war in Ukraine.
Gas was trading around $11 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe TRNLTTFMc1 and $14 at
the Japan Korea Marker (JKM) in Asia JKMc1 . NG/EU
Week ended Week ended Year ago Five-year
Sep 29 Sep 22 Sep 29 average
Actual Actual Sep 29
U.S. weekly natgas storage change (bcf): 86 90 126 103
U.S. total natgas in storage (bcf): 3,445 3,359 3,088 3,273
U.S. total storage versus 5-year average 5.3% 6.0%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
Last Year Average Average
2022 (2017-2021)
Henry Hub NGc1 2.98 2.96 6.08 6.54 2.89
Title Transfer Facility (TTF) TRNLTTFMc1 11.52 11.65 38.37 40.50 7.49
Japan Korea Marker (JKM) JKMc1 14.15 14.25 32.98 34.11 8.95
LSEG 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 100 82 91 84 110
U.S. GFS CDDs 57 70 54 70 53
U.S. GFS TDDs 157 152 145 154 163
LSEG U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Next Week This Week Five-Year
Week Last Year Average For
Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production 102.6 102.3 102.4 100.4 93.1
U.S. Imports from Canada 6.8 6.7 6.5 8.6 7.8
U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1
Total U.S. Supply 109.4 109.0 108.9 109.0 101.0
U.S. Demand (bcfd)
U.S. Exports to Canada 1.7 1.5 1.5 2.2 2.2
U.S. Exports to Mexico 7.3 7.2 7.3 5.5 5.6
U.S. LNG Exports 12.1 12.7 12.8 10.4 7.1
U.S. Commercial 4.9 5.0 6.3 5.8 7.0
U.S. Residential 4.0 4.2 6.8 5.9 7.5
U.S. Power Plant 37.0 35.4 31.5 32.0 30.1
U.S. Industrial 21.6 21.6 22.3 21.6 22.1
U.S. Plant Fuel 5.1 5.1 5.1 5.1 5.1
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 74.7 73.3 74.0 72.5 73.9
Total U.S. Demand 95.8 94.8 95.5 90.6 88.8
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam Current Day Prior Day 2023 2022 2021
% of Normal % of Normal % of Normal % of Normal % of Normal
Forecast Forecast Actual Actual Actual
Apr-Sep 95 96 83 107 81
Jan-Jul 91 92 77 102 79
Oct-Sep 93 95 76 103 81
U.S. weekly power generation percent by fuel - EIA
Week ended Week ended Week ended Week ended Week ended
Oct 6 Sep 29 Sep 22 Sep 15 Sep 8
Wind 12 8 8 5 9
Solar 4 4 4 4 4
Hydro 5 5 5 5 5
Other 2 2 2 2 2
Petroleum 0 0 0 0 0
Natural Gas 41 44 43 46 44
Coal 16 17 17 18 19
Nuclear 19 20 20 19 17
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub NG-W-HH-SNL 2.92 2.71
Transco Z6 New York NG-CG-NY-SNL 1.30 1.32
PG&E Citygate NG-CG-PGE-SNL 4.91 4.58
Eastern Gas (old Dominion South) NG-PCN-APP-SNL 1.28 1.21
Chicago Citygate NG-CG-CH-SNL 2.60 2.42
Algonquin Citygate NG-CG-BS-SNL 1.50 1.55
SoCal Citygate NG-SCL-CGT-SNL 7.20 6.23
Waha Hub NG-WAH-WTX-SNL 2.49 1.97
AECO NG-ASH-ALB-SNL 1.67 1.73
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day
New England EL-PK-NPMS-SNL 28.75 33.50
PJM West EL-PK-PJMW-SNL 49.25 61.50
Ercot North EL-PK-ERTN-SNL 27.50 37.50
Mid C EL-PK-MIDC-SNL 71.00 50.25
Palo Verde EL-PK-PLVD-SNL 49.00 24.25
SP-15 EL-PK-SP15-SNL 60.25 46.50
(Reporting by Scott DiSavino)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net))
((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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