US natgas prices fall to 1-week low on rising output, end of heat wave in sight

Reuters
Yesterday
US natgas prices fall to 1-week low on rising output, end of heat wave in sight

Power prices soar as heat wave boosts air conditioning demand

Energy firms keep injecting more gas into storage than usual

Cheniere Sabine LNG export plant on track to exit maintenance reduction

By Scott DiSavino

June 23 (Reuters) - U.S. natural gas futures fell about 3% to a one-week low on Monday on rising output and forecasts for the heat wave blanketing the eastern half of the country to end in a few days.

That heat boosted power prices in some regions to their highest levels since the winter as homes and businesses cranked up air conditioners.

Gas futures for July delivery NGc1 on the New York Mercantile Exchange fell 12.8 cents, or 3.3%, to $3.719 per million British thermal units (mmBtu), putting the contract on track for its lowest close since June 13.

One factor that has weighed on gas prices since mid April was the growing surplus of gas in storage.

Even though the weather was hotter than normal last week, analysts projected energy firms injected more gas into storage than usual, likely boosting stockpiles to around 6% above the five-year average for this time of year. EIA/GAS NGAS/POLL

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states rose to 105.5 billion cubic feet per day so far in June from 105.2 bcfd in May. That was still below the monthly record high of 106.3 bcfd in March, due primarily to normal spring maintenance earlier in the month.

Meteorologists forecast weather across the Lower 48 states will remain mostly warmer than normal through at least July 8.

With more summer heat still to come, LSEG forecast average gas demand in the Lower 48, including exports, would rise from 103.3 bcfd this week to 105.1 bcfd next week. Those forecasts were higher than LSEG's outlook on Friday.

The average amount of gas flowing to the eight big U.S. LNG export plants fell to 14.1 bcfd so far in June, down from 15.0 bcfd in May and a monthly record high of 16.0 bcfd in April.

On a daily basis, however, feedgas was on track to rise from 14.2 bcfd on Sunday to a preliminary 15.0 bcfd on Monday on signs Cheniere Energy's LNG.N 4.5-bcfd Sabine Pass export plant in Louisiana was exiting a maintenance reduction.

Traders said LNG feedgas reductions since April were primarily due to normal spring maintenance, including work at Cameron LNG's 2.0-bcfd plant in Louisiana and Cheniere's Sabine and 3.9-bcfd Corpus Christi plant in Texas, and short, unplanned unit outages at Freeport LNG's 2.1-bcfd plant in Texas on May 6, May 23, May 28, June 3 and June 17.

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 three-month high of around $14 per mmBtu at the Dutch Title Transfer Facility TRNLTTFMc1 benchmark in Europe and a 17-week high of around $14 at the Japan Korea Marker JKMc1 benchmark in Asia. NG/EU

Week ended Jun 20 Forecast

Week ended Jun 13 Actual

Year ago Jun 20

Five-year average

Jun 20

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

+88

+95

+59

+79

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

2,890

2,802

3,094

2,719

U.S. total storage versus 5-year average

+6.3%

+6.1%

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

3.86

3.85

2.81

2.41

3.52

Title Transfer Facility (TTF) TRNLTTFMc1

13.95

13.73

10.87

10.95

15.47

Japan Korea Marker (JKM) JKMc1

14.26

13.88

12.30

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

4

7

4

5

7

U.S. GFS CDDs

228

215

227

192

177

U.S. GFS TDDs

232

222

231

197

184

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

105.7

106.1

105.7

103.0

96.8

U.S. Imports from Canada

8.0

7.8

7.7

N/A

7.3

U.S. LNG Imports

0.0

0.0

0.0

0.0

0.0

Total U.S. Supply

113.7

113.9

113.4

N/A

104.1

U.S. Demand (bcfd)

U.S. Exports to Canada

1.6

2.1

2.0

N/A

2.3

U.S. Exports to Mexico

7.5

7.4

7.4

N/A

6.3

U.S. LNG Exports

13.7

14.4

15.0

12.7

9.1

U.S. Commercial

4.4

4.4

4.3

4.4

4.8

U.S. Residential

3.8

3.8

3.5

3.7

4.3

U.S. Power Plant

38.9

41.5

43.1

44.2

38.0

U.S. Industrial

22.2

22.3

22.2

21.7

21.5

U.S. Plant Fuel

5.2

5.2

5.2

5.2

5.2

U.S. Pipe Distribution

2.0

2.1

2.1

2.1

2.8

U.S. Vehicle Fuel

0.1

0.1

0.1

0.1

0.2

Total U.S. Consumption

76.7

79.5

80.7

81.4

76.8

Total U.S. Demand

99.5

103.3

105.1

N/A

88.2

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

77

79

74

83

107

Jan-Jul

79

79

76

77

102

Oct-Sep

80

81

77

76

103

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

Week ended Jun 27

Week ended Jun 20

2024

2023

2022

Wind

16

10

11

10

11

Solar

7

8

5

4

3

Hydro

5

6

6

6

6

Other

1

1

1

2

2

Petroleum

0

0

0

0

0

Natural Gas

37

40

42

41

38

Coal

17

17

16

17

21

Nuclear

17

18

19

19

19

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

Hub

Current Day

Prior Day

Henry Hub NG-W-HH-SNL

3.09

3.43

Transco Z6 New York NG-CG-NY-SNL

3.45

2.97

PG&E Citygate NG-CG-PGE-SNL

3.00

3.09

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

2.87

3.13

Chicago Citygate NG-CG-CH-SNL

2.98

3.33

Algonquin Citygate NG-CG-BS-SNL

4.25

3.40

SoCal Citygate NG-SCL-CGT-SNL

3.54

4.05

Waha Hub NG-WAH-WTX-SNL

1.54

2.24

AECO NG-ASH-ALB-SNL

0.17

0.91

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

Hub

Current Day

Prior Day

New England E-NEPLMHP-IDX

161.25

56.84

PJM West E-PJWHDAP-IDX

211.48

39.61

Mid C W-MIDCP-IDX

39.20

37.21

Palo Verde W-PVP-IDX

24.42

39.25

SP-15 W-SP15-IDX

9.57

20.13

(Reporting by Scott DiSavino; Editing by David Gregorio)

((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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