June 12, 2020 / 12:09 PM / 21 days ago

U.S. natgas eases on mild weather, lower demand and falling LNG exports

    June 12 (Reuters) - U.S. natural gas futures eased on Friday
on forecasts for milder weather and weaker cooling demand than
previously expected and declining liquefied natural gas exports.
    Front-month gas futures fell 2.1 cents, or 1.2%, to
$1.792 per million British thermal units at 7:54 a.m. EDT (1154
GMT).
    Refinitiv said production in the Lower 48 U.S. states fell
to an average of 88.6 billion cubic feet per day in June from a
one-year low of 89.2 bcfd in May and an all-time monthly high of
95.4 bcfd in November.
    With milder weather expected in mid-June, Refinitiv forecast
U.S. demand, including exports, would slide from 82.5 bcfd this
week to 79.1 bcfd next week before rising to 85.4 bcfd in two
weeks as the weather warms again.
    The amount of pipeline gas flowing to U.S. LNG export plants
fell to an average of 4.1 bcfd (42% utilization) in June, down
from an eight-month low of 6.4 bcfd in May and a monthly record
high of 8.7 bcfd in February. Utilization was about 90% in 2019.

    U.S. LNG exports dropped in recent months as buyers canceled
dozens of cargoes for the summer with U.S. gas prices
trading mostly higher than in Europe
since late April due to demand destruction from the coronavirus
and record-high European stockpiles.
    In fact, higher U.S. prices prompted some energy firms to
send LNG to the United States for storage.

    U.S. pipeline exports, however, are rising as North American
consumers crank up their air conditioners.
    Refinitiv said pipeline exports to Canada averaged 2.3 bcfd
in June, up from a seven-month low of 2.2 bcfd in May but still
well below the all-time monthly high of 3.5 bcfd in December.
Pipeline exports to Mexico averaged 5.4 bcfd this month, up from
4.8 bcfd in May but shy of the record 5.6 bcfd in March.
               
                                       Week ended      Week ended    Year ago   Five-year   
                                          Jun 12         Jun 5        Jun 12     average    
                                        (Forecast)      (Actual)                  Jun 12    
 U.S. natgas storage (bcf):                +87            +93          +111        +87      
                                                                                            
                                                                                            
 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                              8              8            14          14           12
 U.S. GFS CDDs                             177            183          137         158          155
 U.S. GFS TDDs                             185            191          151         172          167
                                                                                            
 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              88.7           88.5         88.6        90.0         77.5
 U.S. Imports from Canada                  6.2            6.0          6.5         7.9          7.9
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.1
 Total U.S. Supply                         95.0           94.6         95.1        97.9         85.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.2            2.4          2.4         2.5          1.9
 U.S. Exports to Mexico                    5.1            5.4          5.1         5.0          4.1
 U.S. LNG Exports                          5.2            4.0          4.0         5.3          1.9
 U.S. Commercial                           4.6            4.5          4.5         4.6          4.7
 U.S. Residential                          3.9            3.8          3.8         3.9          4.1
 U.S. Power Plant                          32.3           34.6         31.6        31.3         31.0
 U.S. Industrial                           21.3           21.3         21.4        21.3         20.4
 U.S. Plant Fuel                           4.4            4.4          4.4         4.4          4.5
 U.S. Pipe Distribution                    1.8            1.9          1.8         1.8          1.9
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    68.6           70.7         67.6        67.4         66.7
 Total U.S. Demand                         81.1           82.5         79.1        80.2         74.6
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.77           1.72                              
 Transco Z6 New York NG-CG-NY-SNL        1.49           1.59                              
 PG&E Citygate NG-CG-PGE-SNL             2.51           2.55                              
 Dominion South NG-PCN-APP-SNL           1.40           1.47                              
 Chicago Citygate NG-CG-CH-SNL           1.57           1.60                              
 Algonquin Citygate NG-CG-BS-SNL         1.55           1.67                              
 SoCal Citygate NG-SCL-CGT-SNL           2.05           2.24                              
 Waha Hub NG-WAH-WTX-SNL                 1.46           1.42                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             22.75          20.75                              
 PJM West EL-PK-PJMW-SNL                20.03          24.75                              
 Ercot North EL-PK-ERTN-SNL             21.50          19.50                              
 Mid C EL-PK-MIDC-SNL                    6.38          15.50                              
 Palo Verde EL-PK-PLVD-SNL              19.75          24.75                              
 SP-15 EL-PK-SP15-SNL                   20.50          27.00                              
 
 (Reporting by Scott DiSavino)
  
 
 
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