Colder weather expected to increase gas demand for heating
Record LNG flows boost US natural gas demand
Global gas prices lower amid Russia-Ukraine peace talks
Record US gas output allows for increased stockpiling
By Scott DiSavino
NEW YORK, Dec 1 (Reuters) - U.S. natural gas futures held near a 35-month high on Monday on record flows to liquefied natural gas $(LNG)$ export plants and forecasts for colder weather and higher demand over the next two weeks than previously expected.
Limiting gains were record output, ample amounts of gas in storage and lower gas prices around the world due mostly to the Ukraine peace talks.
Front-month gas futures for January delivery NGc1 on the New York Mercantile Exchange rose 1.9 cents, or 0.4%, to $4.869 per million British thermal units (mmBtu), putting the contract on track for its highest close since December 2022 for a second day in a row.
That also kept the front-month in technically overbought territory for a second day in a row for the first time since mid-November.
SUPPLY AND DEMAND
LSEG said average gas output in the Lower 48 states rose to a record 109.6 billion cubic feet per day (bcfd) in November, up from 107.0 bcfd in October and the prior all-time monthly high of 108.0 bcfd in August.
Record output this year has allowed energy companies to stockpile more gas than usual, leaving about 5% more gas in storage than normal for this time of year. EIA/GAS NGAS/POLL
Meteorologists forecast temperatures across the country will remain mostly colder than normal through December 16.
LSEG projected average gas demand in the Lower 48 states, including exports, would fall from 142.0 bcfd this week to 139.7 bcfd next week. Those forecasts were higher than LSEG's outlook on Friday.
Average gas flows to the eight big LNG export plants operating in the U.S. rose to a record 18.2 bcfd in November, topping the prior all-time monthly high of 16.6 bcfd in October.
In LNG news, the Imsaikah LNG vessel was anchored near Exxon Mobil/QatarEnergy's XOM.N 2.4 bcfd Golden Pass LNG export plant under construction in Texas, according to LSEG data and analyst comments.
The ship is carrying LNG from Qatar that traders and analysts say will be used to cool equipment as part of the commissioning of the plant. The facility is expected to start producing LNG later this year or early next year.
The U.S.became the world's biggest LNG producer in 2023, surpassing Australia and Qatar as surging global prices fed demand for more exports, due in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.
Around the world, gas prices fell to an 18-month low near $10 per mmBtu at the Dutch Title Transfer Facility (TTF) TRNLTTFMc1 in Europe on negotiations over a potential peace plan for Russia and Ukraine, while prices at the Japan Korea Marker (JKM) JKMc1 in Asia held near a one-month low of about $11. NG/EU
Week ended Nov 28 Actual | Week ended Nov 21 Actual | Year ago Nov 28 | Five-year average Nov 28 | ||
U.S. weekly natgas storage change (bcf): | -12 | -11 | -26 | -43 | |
U.S. total natgas in storage (bcf): | 3,923 | 3,935 | 3,941 | 3,732 | |
U.S. total storage versus 5-year average | +5.1% | +4.2% | |||
Global Gas Benchmark Futures ($ per mmBtu) | Current Day | Prior Day | This Month Last Year | Prior Year Average 2024 | Five-Year Average (2019-2023) |
Henry Hub NGc1 | 4.78 | 4.85 | 3.41 | 2.41 | 3.52 |
Title Transfer Facility (TTF) TRNLTTFMc1 | 9.54 | 9.75 | 13.83 | 10.95 | 15.47 |
Japan-Korea Marker (JKM) JKMc1 | 11.09 | 11.12 | 14.34 | 11.89 | 15.23 |
LSEG U.S. Global Forecast System $(GFS)$ Heating, Cooling and Total Degree Days | |||||
Two-Week Total Forecast | Current Day | Prior Day | Prior Year | 10-Year Norm | 30-Year Norm |
U.S. GFS Heating Degree Days (HDD) | 436 | 412 | 397 | 360 | 389 |
U.S. GFS Cooling Degree Days (CDD) | 5 | 5 | 3 | 6 | 5 |
U.S. GFS Total Degree Days (TDD) | 441 | 417 | 400 | 366 | 394 |
LSEG U.S. Weekly GFS Supply and Demand Forecasts | |||||
Prior Week | Current Week | Next Week | This Week Last Year | Five-Year (2020-2024) Average For Month | |
U.S. Supply (bcfd) | |||||
U.S. Lower 48 Dry Production | 110.5 | 110.8 | 110.5 | 103.7 | 99.3 |
U.S. Imports from Canada | 8.8 | 9.4 | 9.1 | N/A | 8.9 |
U.S. LNG Imports | 0.0 | 0.0 | 0.0 | 0.0 | 0.1 |
Total U.S. Supply | 119.2 | 120.3 | 119.5 | N/A | 108.3 |
U.S. Demand (bcfd) | |||||
U.S. Exports to Canada | 3.2 | 2.9 | 2.9 | N/A | 3.3 |
U.S. Exports to Mexico | 6.1 | 5.7 | 6.0 | N/A | 5.4 |
U.S. LNG Export Feedgas | 18.6 | 19.1 | 18.7 | 14.2 | 12.8 |
U.S. Commercial | 12.1 | 17.5 | 17.2 | 17.5 | 14.9 |
U.S. Residential | 18.9 | 29.6 | 28.9 | 29.3 | 24.2 |
U.S. Power Plant | 31.4 | 32.3 | 31.6 | 36.3 | 33.6 |
U.S. Industrial | 24.3 | 26.1 | 25.8 | 26.2 | 25.2 |
U.S. Plant Fuel | 5.5 | 5.5 | 5.5 | 5.5 | 5.7 |
U.S. Pipe Distribution | 2.5 | 3.0 | 3.0 | 2.5 | 4.2 |
U.S. Vehicle Fuel | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 |
Total U.S. Consumption | 94.8 | 114.2 | 112.1 | 117.4 | 108.0 |
Total U.S. Demand | 122.8 | 142.0 | 139.7 | N/A | 129.5 |
N/A = Not Available | |||||
U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam (Fiscal year ending Sep 30) | 2026 Current Day % of Normal Forecast | 2026 Prior Day % of Normal Forecast | 2025 % of Normal Actual | 2024 % of Normal Actual | 2023 % of Normal Actual |
Apr-Sep | 89 | 88 | 76 | 74 | 83 |
Jan-Jul | 86 | 84 | 78 | 76 | 77 |
Oct-Sep | 87 | 86 | 80 | 77 | 76 |
U.S. weekly power generation percent by fuel - EIA | |||||
Week ended Dec 5 | Week ended Nov 28 | 2024 | 2023 | 2022 | |
Wind | 16 | 11 | 11 | 10 | 11 |
Solar | 4 | 5 | 5 | 4 | 3 |
Hydro | 5 | 5 | 6 | 6 | 6 |
Other | 1 | 1 | 1 | 2 | 2 |
Petroleum | 0 | 0 | 0 | 0 | 0 |
35 | 39 | 42 | 41 | 38 | |
Coal | 18 | 8 | 16 | 17 | 21 |
Nuclear | 20 | 21 | 19 | 19 | 19 |
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) | |||||
Hub | Current Day | Prior Day | This Month Last Year | Prior Year Average 2024 | Five-Year Average (2019-2023) |
Henry Hub | 4.59 | 4.12 | 3.02 | 2.19 | 3.49 |
Transco Z6 New York | 4.11 | 4.03 | 3.31 | 1.98 | 3.29 |
PG&E Citygate | 4.34 | 4.33 | 3.42 | 3.04 | 5.47 |
Eastern Gas (old Dominion South) | 3.92 | 3.75 | 2.70 | 1.68 | 2.77 |
Chicago Citygate | 4.30 | 3.91 | 2.82 | 2.00 | 3.41 |
Algonquin Citygate | 7.70 | 6.97 | 8.16 | 2.88 | 4.27 |
SoCal Citygate | 4.63 | 4.42 | 3.54 | 2.47 | 5.92 |
Waha Hub | 1.28 | 0.74 | 2.28 | 0.77 | 2.91 |
AECO | 2.14 | 2.18 | 1.26 | 0.96 | 2.28 |
ICE U.S. Power Next-Day Prices ($ per megawatt-hour) | |||||
Hub | Current Day | Prior Day | This Month Last Year | Prior Year Average 2024 | Five-Year Average (2019-2023) |
78.88 | 79.84 | 85.01 | 47.35 | 48.44 | |
PJM West | 72.25 | 52.14 | 43.03 | 41.98 | 45.33 |
Mid C | 51.75 | 55.46 | 42.33 | 63.89 | 61.73 |
Palo Verde | 32.33 | 35.00 | 32.02 | 39.50 | 62.42 |
SP-15 | 34.83 | 37.41 | 39.19 | 31.30 | 58.87 |
(Reporting by Scott DiSavino, Editing by Louise Heavens)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net/))