Sept 24 (Reuters) - U.S. natural gas futures edged higher on Tuesday on forecasts for more air conditioning demand this week than previously expected as warmer than normal weather lingers over much of the country.
Front-month gas futures NGc1 for October delivery on the New York Mercantile Exchange were up 3 cents, or 1.2%, to $2.557 per million British thermal units at 8:21 a.m. EDT (1221 GMT).
Meteorologists forecast temperatures would remain warmer over the eastern two-thirds of the country and colder in the western third through early October.
That warmth prompted data provider Refinitiv to boost its projection for average gas demand in the lower 48 U.S. states to 83.5 billion cubic feet per day (bcfd) for this week, up from its earlier forecast of 83.0 bcfd on Monday as power generators burn more gas to keep air conditioners humming.
Refinitiv forecast demand would also average 83.5 bcfd next week as the weather cools with the coming of autumn and heating demand starts to replace cooling demand.
Traders noted warmer-than-normal weather in late September and early October tends to reduce overall demand because homes and businesses will not need to use much air conditioning or heat.
Export demand is also expected to rise in coming weeks as the country sends out more fuel to Mexico via pipelines and the rest of the world via liquefied natural gas (LNG).
Gas flows to U.S. LNG export plants rose to 6.2 bcfd on Sunday from a low of 5.7 bcfd last week following the shutdown of Dominion Energy Inc's D.N Cove Point in Maryland for planned maintenance, according to Refinitiv data. projected flows to LNG terminals could rise to 6.5 bcfd by the end of next week, putting it closer to the record high of 6.8 bcfd on Aug. 25.
Exports to Mexico, meanwhile, slipped to 4.9 bcfd on Monday as flows on some pipes decreased, down from a record high 5.6 bcfd last week as gas started to move through the 2.6-bcfd Valley Crossing pipeline from Texas to Mexico. said they expect exports to Mexico to return to record levels in coming weeks as Kinder Morgan (NYSE:KMI) Inc's KMI.N Permian Express pipe in Texas enters service.
Analysts said utilities likely added 86 billion cubic feet (bcf) of gas to storage during the week ended Sept. 20. That compares with an injection of 51 bcf during the same week last year and a five-year (2014-18) average build of 74 bcf for the period. EIA/GAS
If correct, the increase would boost stockpiles to 3.189 trillion cubic feet (tcf), 1.9% below the five-year average of 3.252 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 average in March 2019. But with production near a record high, analysts said, stockpiles should reach a near-normal 3.7 tcf by the end of the summer injection season on Oct. 31. NGAS/POLL
Gas production in the lower 48 states edged up to 92.5 bcfd on Monday from an average of 92.0 bcfd last week, 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 20
average
20(Forecas Sep 13
Sep 20
(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
73 U.S. GFS CDDs
70 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
20.75
23.75
PJM West EL-PK-PJMW-SNL
28.56
36.25
Ercot North EL-PK-ERTN-SNL
95.67
37.30
Mid C EL-PK-MIDC-SNL
43.50
24.00
Palo Verde EL-PK-PLVD-SNL
45.75
23.75
SP-15 EL-PK-SP15-SNL
53.75
33.25