U.S. natgas edges up on forecasts for colder weather, higher demand (updated)
08/02/2022 19:58
(New throughout, updates prices, market activity and comments)
Feb 8 (Reuters) - U.S. natural gas futures edged up on Tuesday, as forecasts for a little colder weather
than expected and higher heating demand over the next two weeks offset a slow increase in output following
weeks of reductions due to freezing wells and pipes.
Prices had fallen for three days in record volatility.
Front-month gas futures NGc1 for March delivery rose 1.6 cents, or 0.4%, to settle at $4.248 per million
British thermal units (mmBtu). On Monday, the contract closed at its lowest since Jan. 25.
In the spot market, frigid weather and high heating demand in the U.S. Northeast since the start of 2022
have kept next-day power and gas prices in New York NG-CG-NY-SNL and New England NG-CG-BS-SNL
EL-PK-NPMS-SNL at or near their highest levels since January 2018. This prompted power generators there to
burn lots of oil and liquefied natural gas (LNG). urn:newsml:reuters.com:*:nL1N2TR0X4 urn:newsml:reuters.com:*:nL1N2TN1OX
Data provider Refinitiv said output in the U.S. Lower 48 states fell from a record 97.3 billion cubic feet
per day (bcfd) in December to 93.9 bcfd in January and 90.4 bcfd in February after wells in several regions
froze, including the Permian in Texas and New Mexico, the Bakken in North Dakota and the Appalachia in
Pennsylvania, West Virginia and Ohio. February's average was higher than it was on Monday due to an expected
output rise on Tuesday. urn:newsml:reuters.com:*:nL1N2TJ23J
Even though forecasts were colder than expected, meteorologists still expect next week's temperatures to
be milder than this week.
Refinitiv projected average U.S. gas demand, including exports, would drop from 130.6 bcfd this week to
122.3 bcfd next week. Those forecasts were higher than Refinitiv's outlook on Monday.
The amount of gas flowing to U.S. LNG export plants was up to 12.5 bcfd so far in February, which would
top the monthly record of 12.4 bcfd in January, as liquefaction trains at Venture Global LNG's Calcasieu Pass
export plant in Louisiana enter service. A vessel arrived near Calcasieu on Monday and could pick up the
plant's first LNG cargo this week. urn:newsml:reuters.com:*:nL1N2UI1T5
Traders said demand for U.S. LNG would remain strong so long as global gas prices TRNLTTFMc1 JKMc1
keep trading well above U.S. futures as utilities around the world scramble for cargoes to meet surging demand
in Asia and replenish low stockpiles in Europe - especially with the threat Russia could invade Ukraine and
cut gas supplies to Europe. NG/GB urn:newsml:reuters.com:*:nL1N2UD16S urn:newsml:reuters.com:*:nL8N2RT64U urn:newsml:reuters.com:*:nL1N2U52QX
Russia supplied Europe with about 16.3 bcfd of gas in 2021, representing 35%-40% of the continent's
supply, according to analysts and U.S. energy data. urn:newsml:reuters.com:*:nL8N2RT64U urn:newsml:reuters.com:*:nL1N2U52QX
Gas prices were trading around $27 per mmBtu in Europe TRNLTTFMc1 and $25 in Asia JKMc1 , compared with
just $4 in the United States. But no matter how high global gas prices rise, the United States only has
capacity to turn about 12.4 bcfd of gas into LNG. The rest of the gas flowing to LNG facilities is used to run
plant equipment.
Global markets will have to wait until later this year when more of the 18 liquefaction trains under
construction at Calcasieu start producing LNG. The first trains at the plant started producing LNG in January.
urn:newsml:reuters.com:*:nL1N2RV25Q urn:newsml:reuters.com:*:nL1N2SN32X
Week ended Week ended Year ago Five-year
Feb. Jan. 28 Feb. 4 average
4(Forecast) (Actual) Feb. 4
U.S. weekly natgas storage change (bcf): -226 -268 -174 -150
U.S. total natgas in storage (bcf): 2,097 2,323 2,542 2,316
U.S. total storage versus 5-year average -9.5% -5.8%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
Last Year Average Average
2021 (2017-2021)
Henry Hub NGc1 4.23 4.23 2.92 3.73 2.89
Title Transfer Facility (TTF) TRNLTTFMc1 27.25 25.99 6.14 16.04 7.49
Japan Korea Marker (JKM) JKMc1 25.10 25.35 7.36 18.00 8.95
Refinitiv 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 395 391 556 403 399
U.S. GFS CDDs 3 3 5 6 5
U.S. GFS TDDs 398 394 561 409 404
Refinitiv U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Week Next Week This Week Five-Year
Last Year Average For
Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production 93.1 89.5 89.7 87.8 83.3
U.S. Imports from Canada 9.3 9.3 8.6 9.2 8.9
U.S. LNG Imports 0.1 0.2 0.1 0.1 0.2
Total U.S. Supply 102.5 99.0 98.4 97.1 92.4
U.S. Demand (bcfd)
U.S. Exports to Canada 2.4 2.1 2.0 2.0 2.7
U.S. Exports to Mexico 5.8 5.5 5.7 6.0 4.8
U.S. LNG Exports 12.2 12.4 12.0 10.5 4.7
U.S. Commercial 19.4 18.1 17.3 20.5 15.6
U.S. Residential 33.2 30.5 28.3 34.7 26.1
U.S. Power Plant 28.6 28.8 24.5 30.3 26.3
U.S. Industrial 25.9 25.7 25.2 26.7 24.5
U.S. Plant Fuel 4.6 4.4 4.4 4.4 4.6
U.S. Pipe Distribution 3.1 2.9 2.7 2.9 3.1
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 114.9 110.7 102.6 119.6 100.3
Total U.S. Demand 135.3 130.6 122.3 138.1 112.5
U.S. weekly power generation percent by fuel - EIA
Week ended Week ended Week ended Week ended Week ended
Feb 11 Feb 4 Jan 28 Jan 21 Jan 14
Wind 18 11 9 11 10
Solar 3 2 2 2 2
Hydro 8 6 7 7 7
Other 1 2 2 2 2
Petroleum 1 1 1 1 1
Natural Gas 32 33 35 33 34
Coal 23 25 26 25 24
Nuclear 13 19 19 19 20
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub NG-W-HH-SNL 4.44 5.34
Transco Z6 New York NG-CG-NY-SNL 4.90 13.30
PG&E Citygate NG-CG-PGE-SNL 4.81 5.61
Dominion South NG-PCN-APP-SNL 3.94 5.03
Chicago Citygate NG-CG-CH-SNL 4.11 5.10
Algonquin Citygate NG-CG-BS-SNL 13.36 20.75
SoCal Citygate NG-SCL-CGT-SNL 4.06 5.15
Waha Hub NG-WAH-WTX-SNL 3.90 5.04
AECO NG-ASH-ALB-SNL 3.47 3.86
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day
New England EL-PK-NPMS-SNL 145.25 168.50
PJM West EL-PK-PJMW-SNL 26.50 38.75
Ercot North EL-PK-ERTN-SNL 31.00 52.00
Mid C EL-PK-MIDC-SNL 34.50 34.96
Palo Verde EL-PK-PLVD-SNL 40.00 41.00
SP-15 EL-PK-SP15-SNL 40.25 41.75
(Reporting by Scott DiSavino; editing by David Evans and David Gregorio)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging:
scott.disavino.thomsonreuters.com@reuters.net))
((For Refinitiv type ENERGY in Eikon search bar and then go to the GAS dropdown and the NORTH AMERICA dropdown or see: cpurl://apps.cp./cms/?pageid=usa-gas
For Interactive Map, type 'Interactive Map' in the box at upper left of the Reuters 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 ))
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