June 30, 2020 / 7:51 PM / 13 days ago

UPDATE 1-U.S. natgas hits 3-week high, wraps up best quarter since mid-2018

 (Updates prices to settlement)
    June 30 (Reuters) - U.S. natural gas futures rose to their highest in nearly three weeks on Tuesday,
ending the best quarter since June 2018, as forecasts for hotter-than-normal weather increased demand
for cooling.
    August futures rose 4.2 cents, or 2.5%, to settle at $1.751 per million British thermal
units, having jumped more than 14% on Monday, the biggest daily gain since January 2019. 
    Prices have gained nearly 7% this quarter, the most since June 2018.
    "We are seeing some support coming from expectation of summer heat and after last week's collapse
some prolonged heat could actually start to bring in the extra demand and curb injections a little bit
lower," said Daniel Myers, senior market analyst at Gelber & Associates.
    Refinitiv data indicated 243 cooling degree days (CDDs) in the lower 48 states over the next two
weeks. The normal is 191 CDDs for this time of year.
    "Prices might have some trouble holding these gains until LNG export demand goes up and if supply
does not ramp up as expected by many investors," Myers said.
    For the month, futures suffered their second straight fall after slumping to their lowest since
August 1995 last week, hurt by demand destruction from the coronavirus, swelling stockpiles and lower
liquefied natural gas exports earlier in the month.
    Prolonged lockdowns to curb the spread of the coronavirus have kept many businesses shut, cutting
U.S. LNG exports by half since the start of the year with stockpiles filling fast, expected to reach a
record 4.1 trillion cubic feet by the end of October.
    Chesapeake on Sunday became the largest U.S. oil and gas producer to seek bankruptcy protection in
at least five years, falling to heavy debt and the impact of the coronavirus outbreak on energy markets.


                                       Week ended      Week ended    Year ago   Five-year   
                                          June 26       June 19      June 26     average    
                                        (Forecast)      (Actual)                 June 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                              2              3            3           5            4
 U.S. GFS CDDs                             243            222          214         201          191
 U.S. GFS TDDs                             245            225          217         206          195
                                                                                            
 Refinitiv U.S. Weekly GFS Supply and Demand Forecasts                                      
                                        Prior Week    Current Week  Next Week                Five-Year
                                                                                            Average For
                                                                                               Month
 U.S. Supply (bcfd)                                                                               
                                                                                            
 U.S. Lower 48 Dry Production              88.0           87.7         87.7                     77.5
 U.S. Imports from Canada                  6.4            6.3          6.5                      7.9
 U.S. LNG Imports                          0.0            0.0          0.0                      0.1
 Total U.S. Supply                         94.4           94.1         94.2                     85.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.3            2.4          2.4                      1.9
 U.S. Exports to Mexico                    5.5            5.5          5.4                      4.1
 U.S. LNG Exports                          4.1            4.4          3.9                      1.9
 U.S. Commercial                           4.4            4.3          4.3                      4.7
 U.S. Residential                          3.5            3.5          3.5                      4.1
 U.S. Power Plant                          37.3           39.1         43.3                     31.0
 U.S. Industrial                           21.3           21.4         21.4                     20.4
 U.S. Plant Fuel                           4.3            4.3          4.3                      4.5
 U.S. Pipe Distribution                    1.9            2.0          2.1                      1.9
 U.S. Vehicle Fuel                         0.1            0.1          0.1                      0.1
 Total U.S. Consumption                    73.0           74.8         79.1                     66.7
 Total U.S. Demand                         85.0           87.0         90.7                     74.6
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.67           1.42                              
 Transco Z6 New York NG-CG-NY-SNL        1.62           1.39                              
 PG&E Citygate NG-CG-PGE-SNL             2.19           2.10                              
 Dominion South NG-PCN-APP-SNL           1.51           1.29                              
 Chicago Citygate NG-CG-CH-SNL           1.64           1.42                              
 Algonquin Citygate NG-CG-BS-SNL         1.60           1.49                              
 SoCal Citygate NG-SCL-CGT-SNL           1.80           1.54                              
 Waha Hub NG-WAH-WTX-SNL                 1.28           1.19                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             21.50          22.25                              
 PJM West EL-PK-PJMW-SNL                25.00          22.50                              
 Ercot North EL-PK-ERTN-SNL             21.00          20.00                              
 Mid C EL-PK-MIDC-SNL                    0.25          13.75                              
 Palo Verde EL-PK-PLVD-SNL              21.50          21.00                              
 SP-15 EL-PK-SP15-SNL                   21.50          22.50                              
 


 (Reporting by Diptendu Lahiri and Swati Verma in Bengaluru; Editing by Andrea Ricci and Marguerita
Choy)
  
 
 
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