US natgas futures rebound ahead of March contract expiry (updated)
26/02/2024 16:31
(Adds detail paragraphs 1-2, comment in paragraph 6)
Feb 26 (Reuters) - U.S. natural gas futures gained more than 6% on Monday ahead of the expiration of the March contract
following a sharp retreat in the last two sessions, with further support coming from slightly warmer weather forecasts.
Front-month gas futures NGc1 were up 9.5 cents, or 5.9%, to settle at $1.70 per million British thermal units. The March
contract is set to expire on Tuesday.
The market seems to have found a bottom, with the "negative news experienced most of the winter, with low demand, (having) run
its course at this point," said Gary Cunningham, director of market research at Tradition Energy.
"Now we're looking forward to where do we go from here and that's where you're starting to see those CapEx cuts have a bigger
impact and a return to more normal weather patterns for the summer."
On Wednesday, prices soared about 13% after Chesapeake Energy CHK.O , soon to be the biggest U.S. gas producer after its
merger with Southwestern Energy SWN.N , cut planned production for 2024 by roughly 30% after a recent plunge in prices to a 3-1/2
year low.
Price Futures Group analyst Phil Flynn said prices of the fuel were also finding support from hot weather in the south, "which
is giving us a little bit of a cooling demand."
Natural gas prices have plunged 32% so far this year, hurt by a mild winter that has left stockpiles well above normal, while
output remained near record levels despite an Arctic freeze in January that briefly cut output and sent gas demand to a record
high.
Financial company LSEG said gas output in the U.S. Lower 48 states has risen to an average of 105.5 billion cubic feet per day
(bcfd) so far in February from 102.1 bcfd in January, still shy of the monthly record of 106.3 bcfd in December.
"Production curtailments may prove capable of placing a bottom in this market within the next few weeks, but we still see
April futures drafting back down to about the $1.60 level, the low established just prior to the announced production cuts,"
energy advisory Ritterbusch and Associates said in a note.
QatarEnergy chief Saad al-Kaabi said on Sunday a new expansion of its liquefied natural gas (LNG) production will add 16
million metric tons per year to its expansion plans, bringing total capacity to 142 million tons per year (tpy).
The European benchmark wholesale gas price also declined, remaining near its lowest level in around three years, as weak
demand and high storage inventories outweighed cold weather forecasts and lower renewables output. NG/EU
Week ended Week ended Year ago Five-year
Feb 23 Feb 16 Feb 23 average
Forecast Actual Feb 23
U.S. weekly natgas storage change (bcf): -97 -60 -79 -143
U.S. total natgas in storage (bcf): 2,373 2,470 2,126 1,876
U.S. total storage versus 5-year average 26.5%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
Last Year Average Average
2023 (2018-2022)
Henry Hub NGc1 1.73 1.62 2.44 2.66 3.60
Title Transfer Facility (TTF) TRNLTTFMc1 7.53 7.25 16.52 13.04 14.39
Japan Korea Marker (JKM) JKMc1 8.13 8.16 16.87 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 30-Year
Norm Norm
U.S. GFS HDDs 258.5 267 346
U.S. GFS CDDs 9.6 8 8
U.S. GFS TDDs 268.1 275 354
LSEG U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Next Week This Week Five-Year
Week Last Year (2019-2023)
Average For
Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production 105.1 103.5 103.9 101.3 92.4
U.S. Imports from Canada 9.0 8.7 8.7 8.7 9.1
U.S. LNG Imports 0.0 0.0 0.0 0.0 0.2
Total U.S. Supply 114.1 112.2 112.5 110.0 101.7
U.S. Demand (bcfd)
U.S. Exports to Canada 3.5 3.6 3.6 2.6 2.7
U.S. Exports to Mexico 6.4 5.7 6.2 5.8 5.2
U.S. LNG Exports 13.6 13.9 13.7 12.8 8.4
U.S. Commercial 14.8 12.9 11.3 14.1 16.3
U.S. Residential 23.8 20.0 17.6 22.6 27.6
U.S. Power Plant 34.3 31.3 31.4 30.3 29.3
U.S. Industrial 24.9 24.2 23.5 24.1 25.4
U.S. Plant Fuel 5.2 5.1 5.1 5.2 5.3
U.S. Pipe Distribution 2.8 2.6 2.4 2.7 2.7
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 105.9 96.1 91.5 99.1 106.7
Total U.S. Demand 129.4 119.3 115.1 120.3 123.0
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 81 79 83 107 81
Jan-Jul 83 81 77 102 79
Oct-Sep 82 81 76 103 81
U.S. weekly power generation percent by fuel - EIA
Week ended Week ended Week ended Week ended Week ended
March 1 Feb 23 Feb 16 Feb 9 Feb 2
Wind 12 11 14 9
Solar 4 4 3 3
Hydro 7 7 7 7
Other 1 1 1 2
Petroleum 0 0 0 0
Natural Gas 41 41 38 40
Coal 15 16 16 18
Nuclear 20 21 21 20
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub NG-W-HH-SNL 1.52 1.62
Transco Z6 New York NG-CG-NY-SNL 1.49 1.35
PG&E Citygate NG-CG-PGE-SNL 2.49 2.71
Eastern Gas (old Dominion South) NG-PCN-APP-SNL 1.39 1.21
Chicago Citygate NG-CG-CH-SNL 1.35 1.45
Algonquin Citygate NG-CG-BS-SNL 3.23 2.10
SoCal Citygate NG-SCL-CGT-SNL 2.37 2.83
Waha Hub NG-WAH-WTX-SNL 0.19 0.84
AECO NG-ASH-ALB-SNL 1.62 1.63
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day Prior Day
New England EL-PK-NPMS-SNL 30.75 29.50
PJM West EL-PK-PJMW-SNL 27.25 23.25
Ercot North EL-PK-ERTN-SNL 10.25 21.50
Mid C EL-PK-MIDC-SNL 35.66 45.27
Palo Verde EL-PK-PLVD-SNL 22.25 25.10
SP-15 EL-PK-SP15-SNL 21.50 28.00
(Reporting by Ashitha Shivaprasad and Anjana Anil in Bengaluru; Editing by David Evans and Josie Kao)
((Ashitha.Shivaprasad@thomsonreuters.com;))
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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
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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
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