US natgas prices slide 3% to 10-week low on near-record output, mild weather

Reuters
17 Apr
UPDATE 1-US natgas prices slide 3% to 10-week low on near-record output, mild weather

U.S. LNG export feedgas on track to hit record high in April

U.S. gas output on track to hit record high in April

U.S. gas storage about 4% below five-year average

Adds latest prices

By Scott DiSavino

April 16 (Reuters) - U.S. natural gas futures slid about 3% on Wednesday to a 10-week low on near-record output and a decline in daily flows to liquefied natural gas export plants.

In addition, analysts said forecasts for mild weather over the next two weeks should allow utilities to keep pushing lots of gas into storage through early May.

U.S. gas stockpiles are around 4% below normal levels for this time of year after cold weather in January and February forced energy firms to pull large amounts of gas out of storage, including record amounts in January. EIA/GAS NGAS/POLL

Gas futures NGc1 for May delivery on the New York Mercantile Exchange slid 8.2 cents, or 2.5%, to settle at $3.247 per million British thermal units, their lowest close since January 31.

That decline also pushed the contract into oversold territory for a second time this month.

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states rose to 106.3 billion cubic feet per day so far in April, up from a monthly record of 106.2 bcfd in March.

Looking ahead, however, analysts said energy firms could cut back on oil drilling in the coming weeks due to the roughly 14% drop in U.S. crude CLc1 futures so far in April.

The crude price drop was related in part to uncertainty tied to U.S. President Donald Trump's on-again off-again trade tariffs, which could reduce economic growth and oil demand. O/R

Any reduction in oil drilling in shale basins such as the Permian in Texas and New Mexico and the Bakken in North Dakota could boost gas prices by cutting gas output.

Meteorologists projected temperatures in the Lower 48 states would remain mostly warmer than normal through May 1.

With seasonally milder weather coming, LSEG forecast average gas demand in the Lower 48, including exports, will fall from 99.7 bcfd this week to 96.7 bcfd next week. Those forecasts were slightly higher than LSEG's outlook on Tuesday.

The average amount of gas flowing to the eight big LNG export plants operating in the U.S. climbed from a monthly record of 15.8 bcfd in March to 16.2 bcfd so far in April on rising flows to Venture Global's VG.N 3.2-bcfd Plaquemines export plant under construction in Louisiana.

On a daily basis, however, LNG feedgas was on track to hold at a one-week low of 16.1 bcfd on Wednesday, down from an average of 16.7 bcfd over the prior seven days, according to LSEG data.

That daily LNG feedgas decline was mostly due to lower expected flows to Cheniere Energy's LNG.N 3.9-bcfd Corpus Christi export plant in service and under construction in Texas to 1.7 bcfd on Wednesday, down from 2.2 bcfd on Tuesday and an average of 2.3 bcfd over the prior seven days. The Corpus Christi plant includes three 0.8-bcfd operating trains and seven 0.2-bcfd mid-scale trains under construction.

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 in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

Gas was trading at a one-week high of around $12 per mmBtu at the Dutch Title Transfer Facility (TTF) TRNLTTFMc1 benchmark in Europe and a 10-month low of around $11 at the Japan Korea Marker (JKM) JKMc1 benchmark in Asia. NG/EU

Week ended Apr 11 Forecast

Week ended Apr 4 Actual

Year ago Apr 11

Five-year average

Apr 11

U.S. weekly natgas storage change (bcf):

+22

+57

+46

+50

U.S. total natgas in storage (bcf):

1,852

1,830

2,326

1,920

U.S. total storage versus 5-year average

-3.5%

-2.1%

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

3.27

3.33

1.79

2.41

3.52

Title Transfer Facility (TTF) TRNLTTFMc1

11.60

11.32

9.11

10.95

15.47

Japan Korea Marker (JKM) JKMc1

11.37

12.46

10.06

11.89

15.23

LSEG Heating $(HDD.UK)$, Cooling $(CDD.AU)$ 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

107

120

115

141

136

U.S. GFS CDDs

53

45

44

40

37

U.S. GFS TDDs

160

165

159

181

173

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

106.1

106.7

106.8

100.2

97.5

U.S. Imports from Canada

8.4

8.3

7.9

N/A

7.8

U.S. LNG Imports

0.0

0.0

0.0

0.0

0.1

Total U.S. Supply

114.5

115.1

114.7

N/A

105.4

U.S. Demand (bcfd)

U.S. Exports to Canada

2.0

2.6

2.6

N/A

3.3

U.S. Exports to Mexico

7.1

6.9

6.9

N/A

5.4

U.S. LNG Exports

16.2

16.2

16.0

10.7

11.8

U.S. Commercial

10.3

8.4

7.0

6.7

11.8

U.S. Residential

14.9

11.3

8.7

8.1

18.3

U.S. Power Plant

27.0

23.8

25.4

29.0

27.5

U.S. Industrial

24.0

23.1

22.6

22.5

23.8

U.S. Plant Fuel

5.2

5.3

5.3

5.2

5.2

U.S. Pipe Distribution

2.2

2.0

1.9

2.2

3.3

U.S. Vehicle Fuel

0.1

0.1

0.1

0.1

0.2

Total U.S. Consumption

83.9

74.0

71.2

73.8

90.1

Total U.S. Demand

109.2

99.7

96.7

N/A

110.6

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

89

90

74

83

107

Jan-Jul

87

89

76

77

102

Oct-Sep

89

89

77

76

103

U.S. weekly power generation percent by fuel - EIA

Week ended Apr 18

Week ended Apr 11

2024

2023

2022

Wind

18

12

11

10

11

Solar

8

8

5

4

3

Hydro

8

8

6

6

6

Other

1

1

1

2

2

Petroleum

0

0

0

0

0

Natural Gas

31

35

42

41

38

Coal

14

16

16

17

21

Nuclear

19

20

19

19

19

SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)

Hub

Current Day

Prior Day

Henry Hub NG-W-HH-SNL

3.27

3.57

Transco Z6 New York NG-CG-NY-SNL

3.10

3.24

PG&E Citygate NG-CG-PGE-SNL

2.75

2.81

Eastern Gas (old Dominion South) NG-PCN-APP-SNL

2.94

3.01

Chicago Citygate NG-CG-CH-SNL

3.00

3.24

Algonquin Citygate NG-CG-BS-SNL

3.29

3.40

SoCal Citygate NG-SCL-CGT-SNL

3.04

3.26

Waha Hub NG-WAH-WTX-SNL

2.00

2.30

AECO NG-ASH-ALB-SNL

1.69

1.49

ICE U.S. Power Next-Day Prices ($ per megawatt-hour)

Hub

Current Day

Prior Day

New England E-NEPLMHP-IDX

41.79

44.25

PJM West E-PJWHDAP-IDX

51.22

53.84

Mid C W-MIDCP-IDX

25.17

33.99

Palo Verde W-PVP-IDX

30.01

33.83

SP-15 W-SP15-IDX

14.01

18.70

(Reporting by Scott DiSavino; Editing by Richard Chang)

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

For gas data on the LSEG terminal 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 LSEG 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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