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
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.