HomeNewsU.S. natural gas prices up over 1% on rising feedgas to Freeport LNG

U.S. natural gas prices up over 1% on rising feedgas to Freeport LNG

4/22/2024

(Reuters) - U.S. natural gas futures rose more than 1%, as an increase in feedgas to the Freeport LNG export plant and a drop in output outweighed lower demand forecasts for next week and mild weather outlook.

Front-month gas futures <NGc1> for May delivery on the New York Mercantile Exchange were up 2.6 cents higher, or 1.5%, to $1.78 per million British thermal units (mmBtu) at 10:27 a.m. EDT.

On a daily basis, LNG feedgas was on track to rise to a two-week high at 12.8 bcfd, as the amount of gas flowing to Freeport LNG climbs to 0.6 bcfd from 0.1 bcfd on Friday.

Freeport said in late March it expects Trains 1 and 2 to remain shut until May for inspections and repairs, while Train 3 was operating.

"Our perception of this market remains one in which downside price risk appears limited while we also concede that our suggested upside price possibilities may require several weeks," energy advisory Ritterbusch and Associates said in a note.

Financial firm LSEG said gas output in the Lower 48 U.S. states fell to an average of 96.8 billion cubic feet per day (bcfd) so far in April, down from 100.8 bcfd in March. That compares with a monthly record of 105.6 bcfd in December 2023.

LSEG forecasts gas demand in the Lower 48 states, including exports, would fall from 91.7 bcfd this week to 98.2 bcfd next week.

"The demand for natural gas is kind of on the low side because the weather is pretty mild, it's springtime, although that will change as we go into May and June," said Thomas Saal, senior vice president for energy at StoneX Financial.

The U.S. Energy Information Administration (EIA) on Thursday said utilities injected 50 billion cubic feet (bcf) of gas to the storage during the week ended April 12.

U.S. gas production has dropped by around 10% so far in 2024 as several energy firms, including EQT<EQT.N> and Chesapeake Energy<CHK.O>, delayed well completions and cut back on other drilling activities after prices fell to 3-1/2-year lows in February and March.

EQT is currently the biggest U.S. gas producer and Chesapeake is on track to become the biggest producer after its merger with Southwestern Energy<SWN.N>.

Meanwhile, European gas prices declined, after gains last week, on comfortable supply and rising wind output. [NG/EU]

 

Week ended Apr 19 Forecast

Week ended Apr 12 Actual

Year ago Apr 19

Five-year average

Apr 19

  

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

+64

+50

+77

+59

  

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

2,397

2,333

1,986

1,770

  

U.S. total storage versus 5-year average

35.4%

36.4%

      
           
           

Global Gas Benchmark Futures ($ per mmBtu)

Current Day

Prior Day

This Month Last Year

Prior Year Average 2023

Five-Year Average (2018-2022)

Henry Hub <NGc1>

1.75

1.75

2.20

2.66

3.60

Title Transfer Facility (TTF) <TRNLTTFMc1>

9.43

9.95

13.49

13.04

14.39

Japan Korea Marker (JKM) <JKMc1>

10.50

10.88

12.34

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 Norm

30-Year Norm

U.S. GFS HDDs

93

119

132

161

165

U.S. GFS CDDs

58

52

16

34

31

U.S. GFS TDDs

151

171

148

195

196
           

LSEG U.S. Weekly GFS Supply and Demand Forecasts

          
 

Prior Week

Current Week

Next Week

This Week Last Year

Five-Year (2019-2023) Average For Month

U.S. Supply (bcfd)

          

U.S. Lower 48 Dry Production

97.3

96.8

97.0

101.3

95.0

U.S. Imports from Canada

6.9

6.9

6.7

7.6

7.8

U.S. LNG Imports

0.0

0.0

0.0

0.0

0.0

Total U.S. Supply

104.2

103.7

103.7

108.9

102.8
           

U.S. Demand (bcfd)

          

U.S. Exports to Canada

2.7

2.1

2.2

1.9

2.4

U.S. Exports to Mexico

6.4

6.5

6.3

6.0

5.4

U.S. LNG Exports

10.7

11.9

12.5

14.4

10.1

U.S. Commercial

6.7

7.9

6.0

7.4

8.4

U.S. Residential

8.0

10.4

6.8

9.6

11.8

U.S. Power Plant

27.9

28.9

29.8

25.6

22.7

U.S. Industrial

22.5

23.4

22.4

21.5

25.9

U.S. Plant Fuel

4.8

4.8

4.8

4.9

5.0

U.S. Pipe Distribution

1.9

2.1

1.9

2.1

2.3

U.S. Vehicle Fuel

0.1

0.1

0.1

0.1

0.1

Total U.S. Consumption

71.9

77.6

71.8

71.2

76.2

Total U.S. Demand

91.7

98.2

92.9

93.5

94.1
           
           
           
           

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

          
 

Week ended Apr 26

Week ended Apr 19

Week ended Apr 12

Week ended Apr 5

Week ended Mar 29

Wind

16

18

16

15

16

Solar

5

7

6

5

5

Hydro

7

7

7

7

8

Other

1

2

1

1

1

Petroleum

0

0

0

0

0

Natural Gas

38

35

37

38

38

Coal

13

13

13

13

13

Nuclear

20

19

20

20

19
           

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

          

Hub

Current Day

Prior Day

      

Henry Hub <NG-W-HH-SNL>

1.43

1.59

      

Transco Z6 New York <NG-CG-NY-SNL>

1.46

1.38

      

PG&E Citygate <NG-CG-PGE-SNL>

2.16

2.22

      

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

1.40

1.28

      

Chicago Citygate <NG-CG-CH-SNL>

1.37

1.41

      

Algonquin Citygate <NG-CG-BS-SNL>

1.47

1.53

      

SoCal Citygate <NG-SCL-CGT-SNL>

1.50

1.96

      

Waha Hub <NG-WAH-WTX-SNL>

-0.63

-0.69

      

AECO <NG-ASH-ALB-SNL>

1.45

0.93

      
           

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

          

Hub

Current Day

Prior Day

      

New England <EL-PK-NPMS-SNL>

24.50

26.50

      

PJM West <EL-PK-PJMW-SNL>

23.25

25.50

      

Ercot North <EL-PK-ERTN-SNL>

15.50

24.50

      

Mid C <EL-PK-MIDC-SNL>

23.25

25.50

      

Palo Verde <EL-PK-PLVD-SNL>

-0.50

1.50

      

SP-15 <EL-PK-SP15-SNL>

-5.50

-1.00

      

 

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