June 29, 2020 / 7:50 PM / 8 days ago

UPDATE 1-U.S. natgas futures jump 10% on forecasts for warmer weather

 (Adds closing prices)
    June 29 (Reuters) - U.S. natural gas futures rose over 10%
on Monday, regaining ground after slumping to a more than
25-year low the previous session, as forecasts for warmer
weather drove expectations of higher cooling demand for the
fuel.
   In its first day as the front month, gas futures for
August delivery rose 16.5 cents, or 10.7%, to settle at $1.709
per million British thermal units (mmBtu). Prices had earlier
touched their highest since June 15 at $1.753.
    U.S. natural gas futures slumped to their lowest since
August 1995 in the previous session as the market focused on
demand destruction from the coronavirus, swelling stockpiles and
lower liquefied natural gas exports earlier in the month.
    "With temperatures going up, cooling demand has increased
and forecasts say they will continue to increase. Along with
that, Chesapeake's restructuring has also signaled some drop in
supply,"  said Phil Flynn, Price Futures Group senior market
analyst.    
    Chesapeake Energy filed for Chapter 11 on Sunday,
becoming the largest U.S. oil and gas producer to seek
bankruptcy protection in recent years as it bowed to heavy debts
and the impact of the coronavirus outbreak on energy markets.

    Refinitiv data indicated 222 cooling degree days (CDDs) in
the lower 48 states over the next two weeks. The normal is 190
CDDs for this time of year.
   Prolonged lockdowns to curb the spread of coronavirus have
kept many U.S. businesses shut, curbing LNG demand. LNG exports
have also fallen, dropping by half since the start of 2020, with
burgeoning stockpiles expected to reach a record 4.1 trillion
cubic feet by the end of October.
    Refinitiv said production in the Lower 48 U.S. states
averaged 87.8 billion cubic feet per day (bcfd) in June, down
from a 16-month low of 88.2 bcfd in May and an all-time monthly
high of 95.4 bcfd in November.

                                       Week ended      Week ended    Year ago   Five-year   
                                          Jun 26         Jun 19       Jun 26     average    
                                        (Forecast)      (Actual)                  Jun 26    
 U.S. natgas storage (bcf):                +77            +120         +92         +65      
                                                                                            
                                                                                            
 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                              3              3            3           5            4
 U.S. GFS CDDs                             222            218          213         200          190
 U.S. GFS TDDs                             225            221          216         205          194
 
 (Reporting by Diptendu Lahiri in Bengaluru; Editing by Tom
Brown)
  
 
 
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