Sept 30 (Reuters) - U.S. natural gas futures slipped to a near one-month low on Monday, pressured by record-breaking production levels, which boosted storage injections and reduced fears of a supply shortfall.
Gas futures NGc1 for November delivery on the New York Mercantile Exchange fell 6.2 cents, or 2.6%, to $2.342 per million British thermal units (mmBtu) by 10:06 a.m. EDT (1406 GMT), having fallen to their lowest since Sept. 3 at $2.331. That put the front-month on track for a tenth straight session fall for the first time since Aug. 2001.
Despite the decline, the front-month is still on track to post its second consecutive monthly gain and a small quarterly rise, having fallen in the previous three quarters.
Gas production in the lower 48 states rose to an all-time high of 93.32 billion cubic feet per day (bcfd) on Sunday, according to Refinitiv data.
"The strong storage report last week suggests how strong production is given higher-than-normal demand due to above normal weather," said Zhen Zhu, economist at Oklahoma City-based C.H. Guernsey.
"I think there are still rooms for gas prices to go lower in the next month or so before the arrival of winter season."
U.S. Commodity Futures Trading Commission (CFTC) on Friday showed that natgas speculators in four major NYMEX, ICE (NYSE:ICE) markets boosted their net short position by 4,983 contracts to 58,377 in the week to Sept. 24. CFTC/
Analysts said utilities likely added 100 billion cubic feet (bcf) of gas to storage during the week ended Sept. 27. That compares with an injection of 91 bcf during the same week last year and a five-year (2014-18) average build of 83 bcf for the period. EIA/GAS
If correct, that increase would boost stockpiles to 3.305 trillion cubic feet (tcf), 0.9% below the five-year average of 3.335 tcf for this time of year.
The amount of gas in inventory has remained below the five-year average since September 2017. It fell as much as 33% below that in March 2019. But with production hitting record highs, analysts said stockpiles should reach a near-normal 3.7 tcf by the end of summer injection season on Oct. 31. NGAS/POLL
"Last week's bigger-than-expected injection is erasing fears of any supply tightness," said Phil Flynn, senior analyst at Price Futures Group in Chicago.
Data provider Refinitiv projected gas demand in the lower 48 U.S. states would slide to an average of 82.7 bcfd next week, compared with an average of around 85 bcfd forecast this week.
Those demand forecasts include exports, which analysts said would likely rise as more gas flows to LNG export plants and pipelines to Mexico.
Week ended
Year ago Five-year
Sept.
ended
Sept. 27
average
27(Forecas Sept. 20
Sept. 27
(Actual)
U.S. natgas storage (bcf):
Refinitiv Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days
Two-Week Total Forecast
Current
Prior
Prior
10-Year
30-Year
Norm U.S. GFS HDDs
94 U.S. GFS CDDs
57 U.S. GFS TDDs
Refinitiv U.S. Weekly GFS Supply and Demand Forecasts
Prior Week Current Next Week This week Five-Yea
last year
Average
Month U.S. Supply (bcfd)
U.S. Lower 48 Dry Production
75.2 U.S. Imports from Canada
7.7 U.S. LNG Imports
0.1 Total U.S. Supply
100.0
U.S. Demand (bcfd) U.S. Exports to Canada
2.2 U.S. Exports to Mexico
3.8 U.S. LNG Exports
1.1 U.S. Commercial
4.8 U.S. Residential
3.8 U.S. Power Plant
29.9 U.S. Industrial
20.2 U.S. Plant Fuel
4.6 U.S. Pipe Distribution
2.0 U.S. Vehicle Fuel
0.1 Total U.S. Consumption
65.4 Total U.S. Demand
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Current
Prior
Henry Hub NG-W-HH-SNL
Transco Z6 New York NG-CG-NY-SNL
PG&E Citygate NG-CG-PGE-SNL
Dominion South NG-PCN-APP-SNL
Chicago Citygate NG-CG-CH-SNL
Algonquin Citygate NG-CG-BS-SNL
SoCal Citygate NG-SCL-CGT-SNL
Waha Hub NG-WAH-WTX-SNL
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Current
Prior
New England EL-PK-NPMS-SNL
19.25
20.50
PJM West EL-PK-PJMW-SNL
39.06
30.25
Ercot North EL-PK-ERTN-SNL
26.25
37.50
Mid C EL-PK-MIDC-SNL
31.64
25.10
Palo Verde EL-PK-PLVD-SNL
24.50
22.50
SP-15 EL-PK-SP15-SNL
25.25
32.50