Sept 18 (Reuters) - U.S. natural gas futures on Wednesday edged up from a five-month high on forecasts for a little warmer weather and higher cooling demand through the end of September than previously expected.
Front-month gas futures NGc1 for October delivery on the New York Mercantile Exchange (NYMEX) were up 1.6 cents, or 0.6%, to $2.684 per million British thermal units (mmBtu) at 8:37 a.m. EDT (1237 GMT). On Monday, the contract closed at $2.681, its highest since April 10.
The contract, which has been rising steadily since early August on warmer than normal weather forecasts, hit the five-month high this week as gas futures followed a sharp increase in the oil market.
Oil futures jumped nearly 15% on Monday after a weekend attack on Saudi Arabian oil facilities, but fell back 6% on Tuesday when the kingdom said it would restore output by the end of September. O/R
After weeks of gains, the gas front-month was up more than 32% over a recent three-year low of $2.029 per mmBtu on Aug. 5, keeping it in overbought territory for a 12th consecutive day for the first time since June 2016.
That cut the premium of futures for November over October NGV19-X19 to below 3 cents per mmBtu, its lowest since the contracts started trading in 2008, according to NYMEX data from data provider Refinitiv.
With warm weather expected to linger over parts of the country, Refinitiv boosted its projection for average demand next week in the lower 48 U.S. states from 82.4 billion cubic feet per day (bcfd) to 82.6 bcfd as power generators burn more fuel to keep air conditioners humming.
Even though temperatures were expected to remain at above normal levels through the end of September, next week's demand forecast was down from Refinitiv's 85.2 bcfd projection for this week because the weather will still be cooler next week with the coming of autumn.
Tropical Storm Imelda hit the Houston area on Tuesday and weakened into a tropical depression as it moved inland. The storm caused minimal power outages but was expected to drop heavy amounts of rain over southeast Texas over the next day or two. gas exports, meanwhile, were expected to rise slowly over the next two weeks.
Gas flows to U.S. liquefied natural gas (LNG) export plants eased to 6.5 bcfd on Tuesday due to a small decline at Cheniere Energy Inc's LNG.A Sabine Pass terminal in Louisiana, down from a two-week high of 6.7 bcfd on Monday. That compares with an average of 6.1 bcfd last week, according to Refinitiv data.
In two weeks, Refinitiv projected, flows to U.S. LNG terminals could rise to a fresh record high over 6.7 bcfd.
Exports to Mexico, meanwhile, held around 5.1 bcfd over the past two weeks as the market continued to wait for more gas to flow through the 2.6-bcfd Valley Crossing and Sur de Texas-Tuxpan pipes after TC Energy Corp TRP.TO and Sempra's IENOVA unit resolved pipeline contract disputes with Mexico's Federal Electricity Commision in late August. said flows through the Brownsville point in Texas, which the market uses to watch gas moving through the Valley Crossing pipe, jumped to 0.5 bcfd on Tuesday from zero on Monday.
Gas production in the lower 48 states slipped to 91.2 bcfd on Tuesday due to small declines in various regions, down from 92.6 on Monday, according to Refinitiv data. That compares with an all-time daily high of 93.0 bcfd on Aug. 19.
Week ended
Year ago Five-year
ended
Sep 13
average
13(Forecas Sep 6
Sep 13
(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
54 U.S. GFS CDDs
86 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
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
24.50
24.50
PJM West EL-PK-PJMW-SNL
33.50
38.75
Ercot North EL-PK-ERTN-SNL
30.50
33.75
Mid C EL-PK-MIDC-SNL
27.63
25.50
Palo Verde EL-PK-PLVD-SNL
23.75
32.50
SP-15 EL-PK-SP15-SNL
31.50
37.25