Near-record gas flows to LNG export plants boost futures
Milder weather forecasts reduce natural gas demand
Record gas output allows for ample storage
Global gas prices fall amid mild winter, Ukraine peace hopes
Adds latest prices
By Scott DiSavino
NEW YORK, Dec 17 (Reuters) - U.S. natural gas futures climbed about 4% on Wednesday on near-record gas flows to liquefied natural gas $(LNG)$ export plants and forecasts for more demand next week than previously expected.
Front-month gas futures for January delivery NGc1 on the New York Mercantile Exchange rose 13.8 cents, or 3.6%, to settle at $4.024 per million British thermal units (mmBtu). On Tuesday, the contract closed at its lowest since October 29.
That pushed the front-month out of technically oversold territory for the first time in four days.
SUPPLY AND DEMAND
Average gas output in the Lower 48 states eased to 109.5 billion cubic feet per day (bcfd) so far in December, down from a monthly record high of 109.6 bcfd in November, LSEG said.
Record output has allowed energy companies to stockpile more gas than usual so far this year, leaving the amount of fuel in storage at about 1% above normal. EIA/GAS NGAS/POLL
Meteorologists forecast weather across the country would remain mostly warmer than normal through January 1, keeping the amount of gas needed to heat homes and businesses lower than usual for this time of year.
LSEG projected average gas demand in the Lower 48 states, including exports, would fall from 145.1 bcfd this week to 131.1 bcfd next week. The forecast for this week was lower than LSEG's outlook on Tuesday, while the forecast for next week was higher.
Average gas flows to the eight large U.S. LNG export plants rose to 18.6 bcfd so far this month, up from a monthly record high of 18.2 bcfd in November.
Elsewhere, Freeport LNG's export plant in Texas was on track to take in more gas on Wednesday in a sign that one of its three liquefaction trains has returned to service after shutting down on Tuesday.
The U.S. became the world's biggest LNG exporter 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.
Gas was trading near $9 per mmBtu around the world, which was a 19-month low at the Dutch Title Transfer Facility (TTF) TRNLTTFMc1 benchmark in Europe and a 20-month low at the Japan-Korea Marker (JKM) JKMc1 in Asia. NG/EU
Global prices have declined in recent weeks with the slow start of the winter heating season and hopes peace talks over Ukraine could result in the lifting of sanctions against Moscow.
That could allow Russia, the world's second-biggest gas producer behind the U.S., to export more fuel in the future.
Week ended Dec 12 Forecast | Week ended Dec 5 Actual | Year ago Dec 12 | Five-year average Dec 12 | ||
U.S. weekly natgas storage change (bcf): | -169 | -177 | -134 | -96 | |
U.S. total natgas in storage (bcf): | 3,577 | 3,746 | 3,640 | 3,547 | |
U.S. total storage versus 5-year average | +0.8% | +2.8% | |||
Global Gas Benchmark Futures ($ per mmBtu) | Current Day | Prior Day | This Month Last Year | Prior Year Average 2024 | Five-Year Average (2019-2023) |
Henry Hub NGc1 | 3.96 | 3.89 | 3.41 | 2.41 | 3.52 |
Title Transfer Facility (TTF) TRNLTTFMc1 | 9.42 | 9.26 | 13.83 | 10.95 | 15.47 |
Japan-Korea Marker (JKM) JKMc1 | 9.46 | 9.46 | 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) | 350 | 343 | 339 | 402 | 441 |
U.S. GFS Cooling Degree Days (CDD) | 6 | 7 | 6 | 5 | 3 |
U.S. GFS Total Degree Days (TDD) | 356 | 350 | 345 | 407 | 443 |
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 | 109.9 | 108.9 | 108.6 | 104.4 | 99.3 |
U.S. Imports from Canada | 10.2 | 10.4 | 9.3 | N/A | 8.9 |
U.S. LNG Imports | 0.1 | 0.1 | 0.0 | 0.0 | 0.1 |
Total U.S. Supply | 120.1 | 119.4 | 117.9 | N/A | 108.3 |
U.S. Demand (bcfd) | |||||
U.S. Exports to Canada | 3.5 | 3.4 | 3.4 | N/A | 3.3 |
U.S. Exports to Mexico | 6.3 | 5.3 | 6.0 | N/A | 5.4 |
U.S. LNG Export Feedgas | 18.9 | 18.4 | 18.4 | 14.3 | 12.8 |
U.S. Commercial | 17.5 | 18.1 | 15.2 | 15.4 | 14.9 |
U.S. Residential | 29.6 | 30.6 | 25.2 | 23.3 | 24.2 |
U.S. Power Plant | 34.8 | 34.6 | 29.8 | 33.1 | 33.6 |
U.S. Industrial | 25.9 | 26.1 | 24.8 | 24.8 | 25.2 |
U.S. Plant Fuel | 5.4 | 5.4 | 5.4 | 5.4 | 5.7 |
U.S. Pipe Distribution | 3.1 | 3.1 | 2.7 | 3.1 | 4.2 |
U.S. Vehicle Fuel | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 |
Total U.S. Consumption | 116.5 | 117.9 | 103.3 | 105.2 | 108.0 |
Total U.S. Demand | 145.2 | 145.1 | 131.1 | 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 | 102 | 102 | 76 | 74 | 83 |
Jan-Jul | 101 | 101 | 78 | 76 | 77 |
Oct-Sep | 104 | 104 | 80 | 77 | 76 |
U.S. weekly power generation percent by fuel - EIA | |||||
Week ended Dec 19 | Week ended Dec 12 | 2024 | 2023 | 2022 | |
Wind | 11 | 11 | 11 | 10 | 11 |
Solar | 4 | 4 | 5 | 4 | 3 |
Hydro | 5 | 5 | 6 | 6 | 6 |
Other | 1 | 1 | 1 | 2 | 2 |
Petroleum | 0 | 0 | 0 | 0 | 0 |
39 | 39 | 42 | 41 | 38 | |
Coal | 20 | 20 | 16 | 17 | 21 |
Nuclear | 18 | 20 | 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 | 3.58 | 3.90 | 3.02 | 2.19 | 3.49 |
Transco Z6 New York | 3.79 | 7.55 | 3.31 | 1.98 | 3.29 |
PG&E Citygate | 3.03 | 3.36 | 3.42 | 3.04 | 5.47 |
Eastern Gas (old Dominion South) | 3.18 | 3.32 | 2.70 | 1.68 | 2.77 |
Chicago Citygate | 3.19 | 3.36 | 2.82 | 2.00 | 3.41 |
Algonquin Citygate | 7.85 | 16.50 | 8.16 | 2.88 | 4.27 |
SoCal Citygate | 3.19 | 3.57 | 3.54 | 2.47 | 5.92 |
Waha Hub | 0.79 | 0.95 | 2.28 | 0.77 | 2.91 |
AECO | 1.94 | 1.88 | 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) |
96.28 | 171.00 | 85.01 | 47.35 | 48.44 | |
PJM West | 62.47 | 99.81 | 43.03 | 41.98 | 45.33 |
Mid C | 13.76 | 18.59 | 42.33 | 63.89 | 61.73 |
Palo Verde | 25.38 | 24.70 | 32.02 | 39.50 | 62.42 |
SP-15 | 28.08 | 33.10 | 39.19 | 31.30 | 58.87 |
(Reporting by Scott DiSavino; Editing by Alexander Smith and David Gregorio)
((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net/))