US natgas prices rise on increased LNG feedgas, heating demand

ReutersDec 24, 2024 1:52 PM

Dec 24 (Reuters) - U.S. natural gas futures rose on Tuesday to hover near a 23-month high hit in the previous session, on an increase in the amount of gas flowing to liquefied natural gas (LNG) export plants, and forecasts for more cold weather in January leading to increased heating demand than what was previously expected.

Front-month gas futures NGc1 for January delivery on the New York Mercantile Exchange rose 9.4 cents, or 2.6%, to $3.75 per million British thermal units (mmBtu) at 8:18 a.m. EST (1318 GMT). Prices had climbed to their highest since January 2023 on Monday before settling 2.5% lower on short-term warmer weather forecasts.

"As most of the marginal demand comes from the residential and commercial sectors due to heating needs, weather is the most important factor that determines the gas price in winter. We still have a lot of winter left and the uncertainty about weather tends to push up gas prices," said Zhen Zhu, managing consultant at C.H. Guernsey and Company in Oklahoma City.

Financial firm LSEG estimated 376 heating degree days over the next two weeks, compared with 370 estimated on Monday.

"Much of today’s rebound appears prompted by less bearish temperature outlooks within the 6–14-day portion of the NOAA forecast," energy advisory firm Ritterbusch and Associates said in a note.

Mild temperatures are expected to subside later next week in limiting downside possibilities, Ritterbusch said.

The amount of gas flowing to the eight big U.S. LNG export plants rose to an average of 14.6 bcfd so far in December from 13.6 bcfd in November. That compares with a monthly record high of 14.7 bcfd in December 2023.

LSEG said average gas output in the Lower 48 U.S. states rose to 103 billion cubic feet per day (bcfd) so far in December from 101.5 bcfd in November. That compares with a record 105.3 bcfd in December 2023.

It also forecast average gas demand in the Lower 48, including exports, rising to 132.6 bcfd this week from 124.7 bcfd in the prior week.

Meanwhile, Venture Global LNG wants to extend the force majeure at its Calcasieu Pass liquefied natural gas plant in Louisiana to 2025, delaying first supplies under long-term contracts to three years after starting production, according to its initial public offering document.

Dutch and British wholesale gas prices were slightly up on Wednesday in thin trading ahead of Christmas holidays across Europe, as uncertainty remains over Russian gas flows when the Ukraine gas transit deal expires at the year-end. NG/EU

	Week ended Dec 20 Forecast	Week ended Dec 13 Actual	Year ago Dec 20	Five-year average Dec 20
U.S. weekly natgas storage change (bcf):	-97	-125	-87	-127
U.S. total natgas in storage (bcf):	3,525	3,622	3,515	3,363
U.S. total storage versus 5-year average	4.8%	3.8%


Global Gas Benchmark Futures ($ per mmBtu)	Current Day	Prior Day	This Month Last Year	Prior Year Average 2023	Five-Year Average (2018-2022)
Henry Hub NGc1	3.76	3.71	2.54	2.66	3.60
Title Transfer Facility (TTF) TRNLTTFMc1	14.08	13.82	11.55	13.04	14.39
Japan Korea Marker (JKM) JKMc1	13.99	13.99	14.03	14.39	14.31


LSEG Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days
Two-Week Total Forecast	Current Day	Prior Day	Prior Year	10-Year Norm	30-Year Norm
U.S. GFS HDDs	376	370	374	427	432
U.S. GFS CDDs	3	2	1	4	3
U.S. GFS TDDs	379	372	375	431	435

LSEG U.S. Weekly GFS Supply and Demand Forecasts
	Prior Week	Current Week	Next Week	This Week Last Year	Five-Year (2019-2023)Average For Month
U.S. Supply (bcfd)
U.S. Lower 48 Dry Production	103.4	102.7	102.2	105.6	97.8
U.S. Imports from Canada	9.5	10.2	9.6	N/A	8.7
U.S. LNG Imports	0.0	0.1	0.0	0.0	0.2
Total U.S. Supply	112.9	113.0	111.8	N/A	106.7

U.S. Demand (bcfd)
U.S. Exports to Canada	3.5	3.5	3.5	N/A	3.4
U.S. Exports to Mexico	5.8	5.8	5.7	N/A	5.4
U.S. LNG Exports	14.0	14.3	14.5	14.7	10.8
U.S. Commercial	14.4	16.5	13.6	13.8	14.3
U.S. Residential	23.4	27.3	22.2	22.0	23.4
U.S. Power Plant	30.9	31.8	29.3	35.1	30.3
U.S. Industrial	24.7	25.3	24.3	24.7	25.1
U.S. Plant Fuel	5.1	5.1	5.0	5.1	5.2
U.S. Pipe Distribution	2.7	2.9	2.6	2.8	3.7
U.S. Vehicle Fuel	0.1	0.1	0.1	0.1	0.1
Total U.S. Consumption	101.5	109.0	97.2	103.6	102.1
Total U.S. Demand	124.7	132.6	120.8	N/A	121.7

N/A is Not Available

U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam	2025 Current Day % of Normal Forecast	2025 Prior Day % of Normal Forecast	2024 % of Normal Actual	2003 % of Normal Actual	2022 % of Normal Actual
Apr-Sep	95	94	74	83	107
Jan-Jul	93	91	76	77	102
Oct-Sep	95	93	77	76	103


U.S. weekly power generation percent by fuel - EIA
	Week ended Dec 27	Week ended Dec 20	2023	2022	2021
Wind	11	13	10	11	10
Solar	4	3	4	3	3
Hydro	6	6	6	6	7
Other	1	1	2	2	2
Petroleum	0	0	0	0	0
Natural Gas	39	38	41	38	37
Coal	19	17	17	21	23
Nuclear	21	21	19	19	20

SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub	Current Day	Prior Day
Henry Hub NG-W-HH-SNL		3.10
Transco Z6 New York NG-CG-NY-SNL		8.22
PG&E Citygate NG-CG-PGE-SNL		3.45
Eastern Gas (old Dominion South) NG-PCN-APP-SNL		2.79
Chicago Citygate NG-CG-CH-SNL		2.86
Algonquin Citygate NG-CG-BS-SNL		15.69
SoCal Citygate NG-SCL-CGT-SNL		3.46
Waha Hub NG-WAH-WTX-SNL		2.39
AECO NG-ASH-ALB-SNL		1.68

SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub	Current Day	Prior Day
New England EL-PK-NPMS-SNL		53.50
PJM West EL-PK-PJMW-SNL		35.50
Ercot North EL-PK-ERTN-SNL		27.88
Mid C EL-PK-MIDC-SNL		36.83
Palo Verde EL-PK-PLVD-SNL		45.00
SP-15 EL-PK-SP15-SNL		45.25

(Reporting by Anjana Anil and Anmol Choubey in Bengaluru; Editing by Mark Porter and Tomasz Janowski)

((Anjana.Anil@thomsonreuters.com;))

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