US natgas prices jump 5% on record flows to LNG export plants (updated)

OSAKA GAS

25/02/2025 20:01

Mild weather allows frozen wells to return to service

US gas output near record high in February

US LNG export feedgas on track for record high in February

Adds latest prices

By Scott DiSavino

Feb 25 (Reuters) - U.S. natural gas futures jumped about 5% on Tuesday with flows to liquefied natural gas (LNG) export plants near record highs.

On its second to last day as the front-month, gas futures NGc1 for March delivery on the New York Mercantile Exchange rose 18.0 cents, or 4.5%, to settle at $4.174 per million British thermal units (mmBtu).

Futures for April NGJ25, which will soon be the front-month, were trading up about 3% to $4.11 per mmBtu.

Those price increases came despite near record output so far this month and forecasts for milder weather and lower heating demand this week than previously expected that should allow utilities to pull less gas out of storage than normal for this time of year.

Traders, however, noted extreme cold earlier this year forced energy firms to pull huge amounts of gas out of storage, including record amounts in January, cutting stockpiles to about 11% below the five-year (2020-2024) usual. EIA/GAS NGAS/POLL

SUPPLY AND DEMAND

Financial company LSEG said average gas output in the Lower 48 U.S. states rose to 104.5 billion cubic feet per day (bcfd) so far in February from 102.7 bcfd in January, when freezing oil and gas wells and pipes, known as freeze-offs, cut production. That compares with a monthly record of 104.6 bcfd in December 2023.

Over the past couple of weeks, daily output dropped from a record high of 106.7 bcfd on February 6 to a three-week low of 100.5 bcfd on February 19 as extreme cold across much of the country froze wells before rising to a one-week high of 104.3 bcfd on February 25 as milder weather unfroze those wells.

Meteorologists projected weather in the Lower 48 states would remain mostly warmer than normal through March 12.

With milder weather coming, LSEG forecast average gas demand in the Lower 48 states, including exports, will fall from 124.8 bcfd this week to 118.4 bcfd next week. The forecast for this week was lower than LSEG's outlook on Monday.

The amount of gas flowing to the eight big U.S. LNG export plants rose to an average of 15.6 bcfd so far in February, up from 14.6 bcfd in January. That compares with a monthly record high of 14.7 bcfd in December 2023.

        On a daily basis, LNG feedgas hit a record 16.4 bcfd on Sunday, topping the prior all-time high of 16.3 bcfd on February 19.

The LNG daily feedgas high occurred as flows to Venture Global's VG.N 3.2-bcfd Plaquemines LNG export plant under construction in Louisiana hit a record 1.8 bcfd on Sunday.

The U.S. became the world's biggest LNG supplier in 2023, surpassing Australia and Qatar, as surging global prices fed demand for more exports, due partly to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

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

UK oil major Shell SHEL.L estimated global demand for LNG would rise by around 60% by 2040, driven largely by economic growth in Asia, artificial intelligence (AI) and efforts to cut emissions in heavy industries and transportation.

Week ended Feb 21 Forecast
Week ended Feb 14 Actual
Year ago Feb 21
Five-year average
Feb 21
U.S. weekly natgas storage change (bcf):
-248
-196
-86
-141
U.S. total natgas in storage (bcf):
1,853
2,101
2,401
2,078
U.S. total storage versus 5-year average
-10.8%
-5.3%
Global Gas Benchmark Futures ($ per mmBtu)
Current Day
Prior Day
This Month Last Year
Prior Year Average 2024
Five-Year Average (2019-2023)
Henry Hub NGc1
4.03
3.99
1.80
2.41
3.52
Title Transfer Facility (TTF) TRNLTTFMc1
14.18
14.20
8.12
10.95
15.47
Japan Korea Marker (JKM) JKMc1
14.34
14.18
8.93
11.89
15.23
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
288
297
256
344
338
U.S. GFS CDDs
7
6
13
10
8
U.S. GFS TDDs
295
303
259
354
346
LSEG U.S. Weekly GFS Supply and Demand Forecasts
Prior Week
Current Week
Next Week
This Week Last Year
Five-Year (2020-2024)Average For Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production
103.0
103.4
103.2
103.2
95.8
U.S. Imports from Canada
11.1
9.7
8.8
N/A
8.0
U.S. LNG Imports
0.0
0.0
0.0
0.0
0.2
Total U.S. Supply
114.1
113.1
112.0
N/A
104.0
U.S. Demand (bcfd)
U.S. Exports to Canada
2.5
3.5
3.0
N/A
2.9
U.S. Exports to Mexico
5.3
5.2
5.6
N/A
5.0
U.S. LNG Exports
20.7
14.4
14.5
14.0
11.3
U.S. Commercial
14.6
14.3
13.5
12.9
15.9
U.S. Residential
35.4
22.8
21.4
20.0
26.4
U.S. Power Plant
34.3
31.9
28.1
30.6
30.0
U.S. Industrial
27.0
24.8
24.5
24.5
25.1
U.S. Plant Fuel
5.1
5.1
5.1
5.1
5.1
U.S. Pipe Distribution
3.3
2.7
2.5
2.8
4.0
U.S. Vehicle Fuel
0.1
0.1
0.1
0.1
0.2
Total U.S. Consumption
125.9
101.7
95.3
96.0
106.7
Total U.S. Demand
148.0
124.8
118.4
N/A
125.9
N/A is Not Available
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam (Fiscal year ending Sep 30)
2025 Current Day
% of Normal Forecast
2025
Prior Day % of Normal Forecast
2024
% of Normal Actual
2023
% of Normal Actual
2022
% of Normal Actual
Apr-Sep
85
87
74
83
107
Jan-Jul
83
85
76
77
102
Oct-Sep
85
86
77
76
103
U.S. weekly power generation percent by fuel - EIA
Week ended Feb 28
Week ended Feb 21
2024
2023
2022
Wind
11
11
11
10
11
Solar
5
4
5
4
3
Hydro
6
6
6
6
6
Other
1
1
1
2
2
Petroleum
0
0
0
0
0
Natural Gas
37
39
42
41
38
Coal
20
22
16
17
21
Nuclear
19
17
19
19
19
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub
Current Day
Prior Day
Henry Hub NG-W-HH-SNL
3.86
4.43
Transco Z6 New York NG-CG-NY-SNL
3.65
4.35
PG&E Citygate NG-CG-PGE-SNL
3.28
3.82
Eastern Gas (old Dominion South) NG-PCN-APP-SNL
3.49
3.96
Chicago Citygate NG-CG-CH-SNL
3.55
4.17
Algonquin Citygate NG-CG-BS-SNL
4.25
11.48
SoCal Citygate NG-SCL-CGT-SNL
3.86
4.22
Waha Hub NG-WAH-WTX-SNL
2.26
2.60
AECO NG-ASH-ALB-SNL
1.13
1.25
ICE U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub
Current Day
Prior Day
New England E-NEPLMHP-IDX
67.51
142.20
PJM West E-PJWHDAP-IDX
38.89
46.56
Mid C W-MIDCP-IDX
23.21
27.69
Palo Verde W-PVP-IDX
17.13
18.06
SP-15 W-SP15-IDX
9.27
19.02


 (Reporting by Scott DiSavino; editing by David Evans)

 ((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net))

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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