July 13, 2020 / 1:01 PM / a month ago

U.S. natgas futures slide on rising output, less hot weather

    July 13 (Reuters) - U.S. natural gas futures slipped on
Monday on slowly rising output and forecasts for less hot
weather and lower air conditioning demand over the next two
weeks than previously expected.
    Traders noted that price decline came despite a drop in
liquefied natural gas (LNG) exports this month to their lowest
since early 2018 due to global coronavirus demand destruction.
    Front-month gas futures for August delivery on the
New York Mercantile Exchange (NYMEX) fell 2.7 cents, or 1.5%, to
$1.778 per million British thermal units at 8:42 a.m. EDT (1242
GMT).
    Looking ahead, speculators boosted their long positions on
the NYMEX last week to their highest since December 2018 on
hopes energy demand will rise as the economy rebounds after
state governments lift coronavirus-linked lockdowns.
    Refinitiv said production in the Lower 48 U.S. states
averaged 88.1 billion cubic feet per day (bcfd) so far in July,
up from a 20-month low of 87.0 bcfd in June but still well below
the all-time monthly high of 95.4 bcfd in November. Traders
noted production rose over the weekend after TC Energy Corp's
 Mountaineer Xpress pipeline in West Virginia returned
to service following unplanned work.
    Refinitiv forecast U.S. demand, including exports, will rise
from 90.4 bcfd this week to 92.2 bcfd next week. That, however,
was lower than Refinitiv's outlook on Friday.
    Pipeline gas flowing to U.S. LNG export plants averaged just
3.2 bcfd (33% utilization) so far in July, down from a 20-month
low of 4.1 bcfd in June and a record high of 8.7 bcfd in
February. Utilization was about 90% in 2019. Flows to Freeport
in Texas held at zero for a seventh day for the first time since
July 2019 when the first of its three liquefaction trains was in
test mode.
        
                                       Week ended      Week ended    Year ago   Five-year   
                                          Jul 10         Jul 3        Jul 10     average    
                                        (Forecast)      (Actual)                  Jul 10    
 U.S. natgas storage (bcf):                +43            +56          +67         +63      
                                                                                            
                                                                                            
 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            2           4            3
 U.S. GFS CDDs                             247            257          220         206          201
 U.S. GFS TDDs                             249            258          222         210          204
                                                                                            
 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              88.2           87.9         87.6        89.1         78.1
 U.S. Imports from Canada                  6.6            7.0          6.7         8.2          8.2
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.2
 Total U.S. Supply                         94.9           94.8         94.4        97.3         86.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.4            2.6          2.5         2.6          2.0
 U.S. Exports to Mexico                    5.4            5.5          5.5         4.7          4.2
 U.S. LNG Exports                          3.1            3.3          3.5         5.9          2.1
 U.S. Commercial                           4.3            4.4          4.4         4.4          4.4
 U.S. Residential                          3.5            3.5          3.5         3.5          3.5
 U.S. Power Plant                          42.7           43.1         44.9        42.3         37.2
 U.S. Industrial                           21.3           21.5         21.5        21.5         20.3
 U.S. Plant Fuel                           4.4            4.3          4.3         4.3          4.4
 U.S. Pipe Distribution                    2.1            2.1          2.2         2.1          2.1
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    78.4           79.0         80.8        78.2         72.0
 Total U.S. Demand                         89.4           90.4         92.2        91.4         80.3
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.79           1.88                              
 Transco Z6 New York NG-CG-NY-SNL        1.67           1.75                              
 PG&E Citygate NG-CG-PGE-SNL             2.71           2.68                              
 Dominion South NG-PCN-APP-SNL           1.22           1.38                              
 Chicago Citygate NG-CG-CH-SNL           1.69           1.80                              
 Algonquin Citygate NG-CG-BS-SNL         1.52           1.69                              
 SoCal Citygate NG-SCL-CGT-SNL           2.16           2.25                              
 Waha Hub NG-WAH-WTX-SNL                 1.57           1.65                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             25.50          22.50                              
 PJM West EL-PK-PJMW-SNL                28.25          32.60                              
 Ercot North EL-PK-ERTN-SNL             40.50          35.00                              
 Mid C EL-PK-MIDC-SNL                   19.00          16.39                              
 Palo Verde EL-PK-PLVD-SNL              69.33          43.50                              
 SP-15 EL-PK-SP15-SNL                   42.00          40.50                              
 
 (Reporting by Scott DiSavino)
  
 
 
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