US natgas prices jump 5% on signs Freeport LNG restarted, colder forecasts (updated)
22/01/2025 18:17
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Gas demand hits record highs on Monday and Tuesday
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Tuesday was coldest day in US in at least five years
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Flows to Freeport LNG export plant in Texas set to rise on Wednesday
(Adds latest prices in paragraphs 1 and 3)
By Scott DiSavino
Jan 22 (Reuters) - U.S. natural gas futures climbed about 5% on Wednesday on signs Freeport LNG's export plant in Texas
may be preparing to exit an outage and on forecasts for colder weather over the next two weeks than previously expected, which
should boost heating demand for the fuel.
Temperatures across the country averaged their lowest in at least five years on Tuesday, pushing demand for gas to new
daily record highs on Monday and Tuesday while spot power and gas prices rose to multi-year highs in several parts of the
country.
Front-month gas futures NGc1 for February delivery on the New York Mercantile Exchange rose 20.4 cents, or 5.4%, to settle
at $3.960 per million British thermal units (mmBtu). On Tuesday, the contract closed at its lowest level since Jan. 9.
Analysts projected energy firms would pull over 200 billion cubic feet (bcf) of gas out of storage for a second and third
week in a row during the weeks ending Jan. 17 and Jan. 24 to meet soaring heating demand. That drawdown would erase a small
surplus of gas, measured over a five-year average, in inventory for the first time since January 2022. EIA/GAS NGAS/POLL
Some analysts said storage withdrawals in January could top the current monthly record high of 994 bcf set in January 2022,
according to federal energy data.
SUPPLY AND DEMAND
Financial firm LSEG said average gas output in the Lower 48 U.S. states fell from 104.2 billion cubic feet per day (bcfd) in
December to 102.0 bcfd so far in January, due mostly to freezing oil and gas wells and pipes, known as freeze-offs. That compares
with a monthly record of 104.5 bcfd in December 2023.
On a daily basis, production was on track to climb by around 1.8 bcfd to a preliminary 99.3 bcfd on Wednesday after
freeze-offs caused output to drop by 6.3 bcfd over the prior four days to a one-year low of 97.5 bcfd on Tuesday.
Freeze-offs so far this winter have been relatively small. In past years, freeze-offs cut gas output by roughly 8.1 bcfd from
Jan. 9-16 in 2024, 4.6 bcfd from Jan. 31-Feb. 1 in 2023, 15.8 bcfd from Dec. 20-24 in 2022, and 20.4 bcfd from Feb. 8-17 in 2021,
according to LSEG data.
Meteorologists projected that weather in the Lower 48 states would remain colder than normal through Jan. 27 before turning
seasonally cold from Jan. 28 through at least Feb. 6.
Jan. 21 was the coldest day on average across the country in at least five years, according to LSEG weather data going back
to 2020.
With less cold weather coming next week, LSEG forecast average gas demand in the Lower 48 states, including exports, would
fall from 153.3 bcfd this week to 142.3 bcfd next week. The latest demand forecast for this week was higher than LSEG's outlook
on Tuesday, while its forecast for next week was lower.
On a daily basis, LSEG said total gas use peaked at 173.3 bcfd on Jan. 20 and 179.7 bcfd on Jan. 21, easily topping the prior
daily record high of 168.4 bcfd on Jan. 16, 2024.
The amount of gas flowing to the eight big U.S. LNG export plants rose to an average of 15.0 bcfd so far in January, up from
14.4 bcfd in December. That compares with a monthly record high of 14.7 bcfd in December 2023.
On a daily basis, however, LNG feedgas dropped by 2.3 bcfd to a six-week low of 13.3 bcfd on Tuesday due mostly to the
shutdown of Freeport LNG's 2.1-bcfd export plant in Texas after a power feed problem during a rare winter storm along the Gulf
Coast. Gas flows to Freeport were on track to rise to 0.3 bcfd on Wednesday.
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
in February 2022.
Gas was trading near a 14-month high of around $15 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe
TRNLTTFMc1 , partly due to the Freeport outage. NG/EU
Week ended Week ended Year ago Five-year
Jan 17 Jan 10 Jan 17 average
Forecast Actual Jan 17
U.S. weekly natgas storage change (bcf): -244 -258 -277 -167
U.S. total natgas in storage (bcf): 2,871 3,115 2,949 2,871
U.S. total storage versus 5-year average 0.0% 2.5%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five-Year
Last Year Average Average
2024 (2019-2023)
Henry Hub NGc1 3.76 3.76 2.72 2.41 3.52
Title Transfer Facility (TTF) TRNLTTFMc1 15.20 15.23 9.55 10.95 15.47
Japan Korea Marker (JKM) JKMc1 14.41 13.78 10.32 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 30-Year
Norm Norm
U.S. GFS HDDs 475 502 368 434 438
U.S. GFS CDDs 2 2 3 4 3
U.S. GFS TDDs 477 504 371 438 441
LSEG U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Next Week This Week Five-Year
Week Last Year (2020-2024)
Average For
Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production 102.1 100.5 101.1 103.2 96.7
U.S. Imports from Canada 10.6 10.9 9.0 N/A 9.1
U.S. LNG Imports 0.0 0.1 0.0 0.1 0.2
Total U.S. Supply 112.7 111.5 109.2 N/A 106.0
U.S. Demand (bcfd)
U.S. Exports to Canada 2.6 2.0 2.2 N/A 3.0
U.S. Exports to Mexico 6.1 6.1 5.7 N/A 5.6
U.S. LNG Exports 14.1 13.4 13.0 13.7 11.6
U.S. Commercial 19.5 22.6 19.3 18.2 16.4
U.S. Residential 33.3 39.9 33.5 30.9 28.4
U.S. Power Plant 34.7 36.0 32.5 38.6 31.4
U.S. Industrial 26.7 27.7 26.4 26.1 25.7
U.S. Plant Fuel 5.0 5.0 4.9 5.0 5.2
U.S. Pipe Distribution 3.3 3.6 3.2 3.3 4.1
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.2
Total U.S. Consumption 122.7 134.8 120.0 122.2 111.4
Total U.S. Demand 145.5 156.4 140.8 N/A 131.6
N/A is Not Available
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam 2025 2025 2024 2023 2022
(Fiscal year ending Sep 30) Current Day Prior Day % of Normal % of Normal % of Normal
% of Normal % of Normal Actual Actual Actual
Forecast Forecast
Apr-Sep 82 84 74 83 107
Jan-Jul 79 82 76 77 102
Oct-Sep 82 84 77 76 103
U.S. weekly power generation percent by fuel - EIA
Week ended Week ended 2024 2023 2022
Jan 24 Jan 17
Wind 11 12 11 10 11
Solar 3 4 5 4 3
Hydro 5 5 6 6 6
Other 1 1 1 2 2
Petroleum 1 0 0 0 0
Natural Gas 39 37 42 41 38
Coal 22 22 16 17 21
Nuclear 19 19 19 19 19
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub NG-W-HH-SNL 4.40 9.86
Transco Z6 New York NG-CG-NY-SNL 22.34 42.86
PG&E Citygate NG-CG-PGE-SNL 4.05 4.89
Eastern Gas (old Dominion South) NG-PCN-APP-SNL 4.41 8.97
Chicago Citygate NG-CG-CH-SNL 4.28 9.99
Algonquin Citygate NG-CG-BS-SNL 20.16 24.09
SoCal Citygate NG-SCL-CGT-SNL 4.50 7.51
Waha Hub NG-WAH-WTX-SNL 3.30 7.96
AECO NG-ASH-ALB-SNL 1.06 1.31
ICE U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day Prior Day
New England E-NEPLMHP-IDX 230.39 268.33
PJM West E-PJWHDAP-IDX 202.99 275.08
Mid C W-MIDCP-IDX 57.30 75.24
Palo Verde W-PVP-IDX 50.79 86.49
SP-15 W-SP15-IDX 37.40 59.93
(Reporting by Scott DiSavino
Editing by Bernadette Baum and Nia Williams)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net))
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For next-day SNL U.S. gas prices, see: 0#SNL-NG
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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
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