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UPDATE 1-U.S. natgas little changed as rising output offsets jump in LNG exports

Published 2020-09-09, 02:57 p/m
© Reuters.
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(Adds latest prices)

Sept 9 (Reuters) - U.S. natural gas futures held steady on Wednesday as rising production and forecasts for lower air conditioning demand in late September offset a jump in liquefied natural gas exports and record sales to Mexico.

After dropping over 7% on Tuesday, front-month gas futures NGc1 rose 0.6 cents, or 0.3%, to settle at $2.406 per million British thermal units on Wednesday.

Data provider Refinitiv said output in the Lower 48 U.S. states was on track to rise to 87.9 billion cubic feet per day (bcfd) in September, up from a three-month low of 87.6 bcfd in August. That, however, was still well below November's all-time monthly high of 95.4 bcfd.

With exports rising and expectations for warm weather through mid September, Refinitiv projected U.S. demand would rise from an average of 84.0 bcfd this week to 85.8 bcfd next week. That is higher than Tuesday's forecast.

In late September, however, demand is expected to decline as air conditioning use drops with the weather forecast to turn seasonably cooler.

The amount of gas flowing to U.S. LNG export terminals soared by a record 1.8 bcfd on Tuesday as Cheniere Energy Inc 's LNG.A Sabine Pass plant in Louisiana continues to ramp up after shutting in late August for Hurricane Laura. Average flows so far in September were 4.1 bcfd. puts gas piped to LNG plants on track to rise for a second month in a row in September for the first time since February when average flows hit a record 8.7 bcfd. Coronavirus demand destruction caused U.S. LNG exports to drop every month from March to July when flows to plants fell to a 21-month low of just 3.3 bcfd as buyers canceled cargoes.

U.S. pipeline exports to Mexico, meanwhile, were on track to rise to 6.1 bcfd in September, which would top August's 5.9-bcfd record.

Week ended

Week ended

Year ago Five-year

Sep 4

Aug 28

Sep 4

average

(Forecast)

(Actual)

Sep 4

U.S. natgas storage (bcf):

+68

+35

+80

+68

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

31

26

10

24

33 U.S. GFS CDDs

120

124

164

130

110 U.S. GFS TDDs

151

150

174

154

143

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

87.0

88.3

88.4

93.2

79.7 U.S. Imports from Canada

6.3

5.7

6.6

7.8

7.9 U.S. LNG Imports

0.0

0.0

0.0

0.0

0.1 Total U.S. Supply

93.3

94.0

95.1

101.0

87.7

U.S. Demand (bcfd) U.S. Exports to Canada

2.0

2.1

2.1

2.4

2.3 U.S. Exports to Mexico

6.2

6.0

6.0

5.4

4.5 U.S. LNG Exports

2.9

4.8

6.5

5.9

2.1 U.S. Commercial

4.6

4.8

4.8

4.7

4.7 U.S. Residential

3.7

3.9

4.0

3.8

3.7 U.S. Power Plant

38.1

34.4

34.5

37.5

32.0 U.S. Industrial

21.5

21.6

21.4

21.2

20.6 U.S. Plant Fuel

4.3

4.4

4.4

4.4

4.4 U.S. Pipe Distribution

2.0

1.9

1.9

1.9

1.9 U.S. Vehicle Fuel

0.1

0.1

0.1

0.1

0.1 Total U.S. Consumption

74.3

71.1

71.2

73.6

67.4 Total U.S. Demand

85.4

84.0

85.8

87.3

76.3

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

Hub

Current Day

Prior Day

Henry Hub NG-W-HH-SNL

2.35

1.80

Transco Z6 New York NG-CG-NY-SNL

1.73

1.38

PG&E Citygate NG-CG-PGE-SNL

3.56

3.67

Dominion South NG-PCN-APP-SNL

1.54

1.34

Chicago Citygate NG-CG-CH-SNL

1.98

1.96

Algonquin Citygate NG-CG-BS-SNL

2.33

1.75

SoCal Citygate NG-SCL-CGT-SNL

3.23

7.97

Waha Hub NG-WAH-WTX-SNL

0.88

1.69

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

Hub

Current Day

Prior Day

New England EL-PK-NPMS-SNL

35.50

20.50

PJM West EL-PK-PJMW-SNL

25.50

21.25

Ercot North EL-PK-ERTN-SNL

18.50

25.25

Mid C EL-PK-MIDC-SNL

38.00

37.40

Palo Verde EL-PK-PLVD-SNL

31.75

120.00

SP-15 EL-PK-SP15-SNL

34.75

102.00

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