(Adds latest prices)
July 8 (Reuters) - U.S. natural gas futures slipped on
Wednesday from a two-month high in the prior session on a
forecast small decline in cooling demand next week, a continued
drop in liquefied natural gas (LNG) exports and a smaller than
expected drop in output due to unplanned pipeline work.
Front-month gas futures fell 5.2 cents, or 2.8%, to
settle at $1.824 per million British thermal units. On Tuesday,
the contract closed at its highest since May 7.
Looking ahead, futures for the balance of 2020 and
calendar 2021 were trading about 22% and 43%,
respectively, over the front-month, on hopes energy demand will
rise.
Refinitiv said production in the Lower 48 U.S. states
averaged 88.2 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.
U.S. gas production on Wednesday was on track to drop to its
lowest since mid June following revisions of pipeline flows on
Tuesday due to unplanned work on TC Energy Corp's
Mountaineer Xpress pipeline in West Virginia that will continue
through at least July 13. On Tuesday, early pipeline flow data
showed output was expected to drop by a record 4.2 bcfd. In
reality, however, output fell by just 1.9 bcfd, which is still
high but only the most in a day since May 1.
As the weather heats up, Refinitiv forecasts U.S. demand,
including exports, will rise from 89.1 bcfd this week to 91.0
bcfd next week. The outlook for next week is a little lower than
Refinitiv expected on Tuesday.
Pipeline gas flowing to U.S. LNG export plants averaged just
3.1 bcfd (32% 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.
Week ended Week ended Year ago Five-year
Jul 3 June Jul 3 average
(Forecast) 26(Actual) Jul 3
U.S. natgas storage (bcf): +58 +65 +83 +68 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 1 1 2 4 3
U.S. GFS CDDs 252 254 227 206 199
U.S. GFS TDDs 253 255 229 210 202
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 87.4 88.3 88.4 90.9 78.1
U.S. Imports from Canada 6.4 6.5 6.7 5.8 8.2
U.S. LNG Imports 0.0 0.0 0.0 0.0 0.2
Total U.S. Supply 93.8 94.8 95.1 96.7 86.5
U.S. Demand (bcfd)
U.S. Exports to Canada 2.4 2.4 2.4 2.5 2.0
U.S. Exports to Mexico 5.4 5.3 5.4 5.2 4.2
U.S. LNG Exports 4.1 3.1 3.3 5.9 2.1
U.S. Commercial 4.3 4.3 4.3 4.4 4.4
U.S. Residential 3.5 3.5 3.5 3.6 3.5
U.S. Power Plant 38.9 42.6 44.0 40.3 37.2
U.S. Industrial 21.3 21.3 21.5 21.4 20.3
U.S. Plant Fuel 4.3 4.4 4.4 4.4 4.4
U.S. Pipe Distribution 2.0 2.1 2.1 2.1 2.1
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 74.4 78.3 79.9 76.3 72.0
Total U.S. Demand 86.3 89.1 91.0 89.9 80.3 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub 1.76 1.71
Transco Z6 New York 1.78 1.76
PG&E Citygate 2.62 2.37
Dominion South 1.34 1.50
Chicago Citygate 1.80 1.71
Algonquin Citygate 1.69 1.75
SoCal Citygate 1.94 1.80
Waha Hub 1.45 1.11 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day Prior Day
New England 16.25 20.25
PJM West 27.75 32.25
Ercot North 22.88 24.25
Mid C 14.25 13.20
Palo Verde 25.00 24.25
SP-15 25.75 25.00
(Reporting by Scott DiSavino
Editing by Nick Zieminski and Tom Brown)
Our Standards: The Thomson Reuters Trust Principles.