July 31, 2020 / 7:09 PM / 9 days ago

UPDATE 1 -U.S. natgas futures slip as weather moderates, cooling demand eases

 (Updates prices)
    July 31 (Reuters) - U.S. natural gas futures slipped almost 2% on Friday on forecasts the weather
will moderate and air-conditioning demand decline now that the hottest days of summer are past.
    Front-month gas futures fell 3.0 cents, or 1.6%, to settle at $1.799 per million British
thermal units.
    For the week, the contract was down less than 1% after rising over 5% last week, and for the month,
the contract was up almost 3% after falling more than 10% in the prior two months.
    In the Atlantic, Hurricane Isaias is expected to march up the U.S. East Coast from Florida to Maine
over the next five days after battering the Bahamas on Friday. Traders noted storms in nonproduction
areas tend to cut demand.
    With the weather expected to moderate, data provider Refinitiv projected U.S. demand, including
exports, will drop from 91.9 billion cubic feet per day (bcfd) this week to 89.3 bcfd next week before
rising to 92.1 bcfd in two weeks with liquefied natural gas (LNG) exports expected to increase.
    Pipeline gas flowing to U.S. LNG export plants averaged 3.3 bcfd (34% utilization) so far in July
after buyers canceled dozens of cargoes, down from a 20-month low of 4.1 bcfd in June and a record 8.7
bcfd in February. Utilization was about 90% in 2019. Analysts expect LNG exports to rise in August since
buyers have so far canceled fewer cargoes that month.
    Refinitiv said pipeline exports to Canada averaged 2.4 bcfd so far in July, up from 2.3 bcfd in
June, but still below the all-time monthly high of 3.5 bcfd in December. Pipeline exports to Mexico
averaged 5.65 bcfd so far this month, up from 5.44 bcfd in June and on track to top the record 5.55 bcfd
in March.
    
                                       Week ended      Week ended    Year ago   Five-year   
                                            Jul          Jul 24       Jul 31     average    
                                       31(Forecast)     (Actual)                  Jul 31    
 U.S. natgas storage (bcf):                +35            +26          +58         +33      
                                                                                            
                                                                                            
 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                              2              1            1           3            3
 U.S. GFS CDDs                             213            216          219         204          197
 U.S. GFS TDDs                             215            217          220         207          200
                                                                                            
 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              89.1           89.1         88.7        91.4         78.1
 U.S. Imports from Canada                  6.8            6.8          7.0         8.1          8.2
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.2
 Total U.S. Supply                         95.9           95.9         95.7        98.4         86.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.4            2.3          2.3         2.6          2.0
 U.S. Exports to Mexico                    5.8            5.7          5.7         5.1          4.2
 U.S. LNG Exports                          3.7            3.2          4.0         5.9          2.1
 U.S. Commercial                           4.4            4.4          4.4         4.4          4.4
 U.S. Residential                          3.5            3.5          3.6         3.5          3.5
 U.S. Power Plant                          44.9           44.6         41.4        41.6         37.2
 U.S. Industrial                           21.4           21.4         21.4        21.5         20.3
 U.S. Plant Fuel                           4.4            4.4          4.4         4.4          4.4
 U.S. Pipe Distribution                    2.2            2.1          2.1         2.1          2.1
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    80.8           80.6         77.3        77.6         72.0
 Total U.S. Demand                         92.7           91.9         89.3        91.2         80.3
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.81           1.77                              
 Transco Z6 New York NG-CG-NY-SNL        1.48           1.80                              
 PG&E Citygate NG-CG-PGE-SNL             2.59           2.58                              
 Dominion South NG-PCN-APP-SNL           1.25           1.31                              
 Chicago Citygate NG-CG-CH-SNL           1.75           1.78                              
 Algonquin Citygate NG-CG-BS-SNL         1.49           1.70                              
 SoCal Citygate NG-SCL-CGT-SNL           2.61           2.59                              
 Waha Hub NG-WAH-WTX-SNL                 1.12           1.30                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             31.75          35.75                              
 PJM West EL-PK-PJMW-SNL                31.00          35.50                              
 Ercot North EL-PK-ERTN-SNL             28.25          28.00                              
 Mid C EL-PK-MIDC-SNL                   35.00          35.29                              
 Palo Verde EL-PK-PLVD-SNL              74.00          75.00                              
 SP-15 EL-PK-SP15-SNL                   62.75          63.75                              
    

 (Reporting by Scott DiSavino in New York
Editing by David Evans and Matthew Lewis)
  
 
 
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