US natgas prices settle up over 2% on hot-weather forecasts (updated)

Southwestern Energy Co

12/07/2024 20:19

(Updates prices and market activity to settlement)
       July 12 (Reuters) - U.S. natural gas futures rose more than 2% on Friday after touching their lowest in close to
two-months during in the session, boosted by forecasts for hotter weather over the next two weeks that should boost
air-conditioning demand. 
    Front-month gas futures  NGc1  for August delivery on the New York Mercantile Exchange settled about 2.7% higher at $2.329 per
million British thermal units (mmBtu). During the session, the contract dropped to its lowest since May 13.
    "We are trying to rebound on the expectations that the outlook going forward is going to be better," said Phil Flynn, an
analyst at Price Futures Group, adding that, because of the potential demand destruction due to the storm Beryl and a bearish
weekly inventory report that showed that production and supplies came in the higher than anticipated it's almost amazing that the
market is holding up as well.
    "On the flip side of that, there are some people that are calling for a return to some hot weather in the coming weeks and
that may give the market some support."
    Financial firm LSEG estimated 257 cooling degree days (CDDs) over the next two weeks in the Lower 48 U.S. states, slightly
higher from the 252 CDDs estimated on Thursday. The normal is 204 CDDs for this time of year.
        LSEG forecast average gas demand in the Lower 48, including exports, at 107.1 billion cubic feet per day (bcfd) this week,
before easing to 106.2 bcfd next week.  
    LSEG said gas output in the Lower 48 has risen to an average of 102.1 billion cubic feet per day (bcfd) in July, up from an
average of 100.2 bcfd in June and a 17-month low of 99.5 bcfd in May. U.S. output hit a monthly record high of 105.5 bcfd in
December 2023.
    Data from the U.S. Energy Information Administration on Wednesday indicated that utilities added 65 billion cubic feet (bcf)
of gas into storage during the week ended July 5. 
    That was more than the 55-bcf build analysts forecast in a Reuters poll and compares with an increase of 57 bcf in the same
week last year and a five-year (2019-2023) average rise of 57 bcf for this time of year.  EIA/GAS   NGAS/POLL 
    That build boosted the amount of gas in storage to around 19% above normal levels for this time of year.
                                
                                                                   Week ended   Week ended    Year ago     Five-year         
                                                                     July 5       June 28      July 5       average         
                                                                     Actual       Actual                    July 5     
 U.S. weekly natgas storage change (bcf):                             +65           +32          +57          +57           
 U.S. total natgas in storage (bcf):                                 3,199         3,134        2,915        2,695          
 U.S. total storage versus 5-year average                            18.7%         18.8%                                     
                                                                                                                             
                                                                                                                             
 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                                                      2.26         2.31         2.64         2.66         3.60
 Title Transfer Facility (TTF)  TRNLTTFMc1                           10.04         9.92         9.58         13.04        14.39
 Japan Korea Marker (JKM)  JKMc1                                     12.37         12.35        11.44        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                                                         3             3                                      3
 U.S. GFS CDDs                                                        257           252                                    204
 U.S. GFS TDDs                                                        260           255                                    207
                                                                                                                             
 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                                            102.1        101.6        101.4        102.1         95.5
 U.S. Imports from Canada                                                  8.2          7.8          7.5          N/A          7.8
 U.S. LNG Imports                                                          0.0          0.0          0.0          0.0          0.1
 Total U.S. Supply                                                       110.3        109.4        108.9          N/A        112.5
                                                                                                                                  
 U.S. Demand (bcfd)                                                                                                               
 U.S. Exports to Canada                                                    1.4          1.5          1.4          N/A          2.3
 U.S. Exports to Mexico                                                    6.8          6.9          6.8          N/A          6.1
 U.S. LNG Exports                                                         11.7         11.5         12.4         13.0          8.6
 U.S. Commercial                                                           4.3          4.4          4.4          4.4          4.5
 U.S. Residential                                                          3.5          3.5          3.6          3.6          3.6
 U.S. Power Plant                                                         49.7         50.2         48.5         44.5         43.3
 U.S. Industrial                                                          21.6         21.7         21.7         21.3         21.3
 U.S. Plant Fuel                                                           5.0          5.0          5.0          5.1          4.9
 U.S. Pipe Distribution                                                    2.3          2.3          2.3          2.3          2.2
 U.S. Vehicle Fuel                                                         0.1          0.1          0.1          0.1          0.1
 Total U.S. Consumption                                                   86.6         87.2         85.6         81.3         79.9
 Total U.S. Demand                                                       106.4        107.1        106.2          N/A         96.9
                                                                                                                                  
 N/A is Not Available                                                                                                  
                                                                                                                       
                                                                                                                        
 U.S. weekly power generation percent by fuel - EIA                                                                               
                                                                   Week ended   Week ended      2023         2022         2021
                                                                     Jul 12        Jul 5                               
 Wind                                                                  5             9           10           11           10
 Solar                                                                 5             6            4            3            3
 Hydro                                                                 6             6            6            6            7
 Other                                                                 1             1            2            2            2
 Petroleum                                                             0             0            0            0            0
 Natural Gas                                                           48           43           41           38           37
 Coal                                                                  18           17           17           21           23
 Nuclear                                                               17           18           19           19           20
                                                                                                                             
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                                                          
 Hub                                                              Current Day    Prior Day                                   
 Henry Hub  NG-W-HH-SNL                                                   2.23         2.40                                       
 Transco Z6 New York  NG-CG-NY-SNL                                        1.63         1.80                                       
 PG&E Citygate  NG-CG-PGE-SNL                                             3.13         3.40                                       
 Eastern Gas (old Dominion South)  NG-PCN-APP-SNL                         1.47         1.56                                       
 Chicago Citygate  NG-CG-CH-SNL                                           1.83         1.84                                       
 Algonquin Citygate  NG-CG-BS-SNL                                         1.78         1.92                                       
 SoCal Citygate  NG-SCL-CGT-SNL                                           2.59         2.97                                       
 Waha Hub  NG-WAH-WTX-SNL                                                 0.81         1.55                                       
 AECO  NG-ASH-ALB-SNL                                                     1.06         0.95                                       
                                                                                                                                  
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                                                             
 Hub                                                              Current Day    Prior Day                                        
 New England  EL-PK-NPMS-SNL                                             46.25        56.00                                       
 PJM West  EL-PK-PJMW-SNL                                                49.50        37.75                                       
 Ercot North  EL-PK-ERTN-SNL                                             25.25        29.50                                       
 Mid C  EL-PK-MIDC-SNL                                                   84.00       145.00                                       
 Palo Verde  EL-PK-PLVD-SNL                                              80.00       115.50                                       
 SP-15  EL-PK-SP15-SNL                                                   63.50        96.75                                       
 
 (Reporting by Daksh Grover, Rahul Paswan and Brijesh Patel in Bengaluru; editing by David Evans and DAvid Gregorio)
 ((Daksh.Grover@thomsonreuters.com;))
 
((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 ))