May 20, 2020 / 8:07 PM / 3 months ago

UPDATE 1-U.S. natgas futures slip 3% as demand and exports decline

 (Adds latest prices)
    May 20 (Reuters) - U.S. natural gas futures fell about 3% on Wednesday as government lockdowns to
stop the spread of coronavirus cut demand for the fuel and exports.
    That decline comes even though energy firms continued to cut production in response to the collapse
in oil and gas prices earlier this year, which ironically was also due in part to demand destruction
from the pandemic.
    Front-month gas futures for June delivery on the New York Mercantile Exchange fell 5.9 cents,
or 3.2%, to settle at $1.771 per million British thermal units.
    Analysts said they expect prices to rise as governments lift travel restrictions and economies
rebound. Futures for the balance of 2020 and calendar 2021 were trading about 25%
and 50% over the front-month, respectively.
    Data provider Refinitiv said average gas output in the U.S. Lower 48 states fell to 89.7 billion
cubic feet per day (bcfd) so far in May, down from an eight-month low of 92.9 bcfd in April and an
all-time monthly high of 95.4 bcfd in November.
    Refinitiv projected demand in the Lower 48, including exports, would slip from 78.7 bcfd this week
to 78.4 bcfd next week. That compares with Refinitiv's forecasts on Tuesday of 78.2 bcfd this week and
78.1 bcfd next week.
    Refinitiv said U.S. pipeline exports to Canada averaged 2.2 bcfd so far in May, down from 2.4 bcfd
in April and an all-time monthly high of 3.5 bcfd in December. Pipeline exports to Mexico averaged 4.6
bcfd so far this month, down from 4.7 bcfd in April and a record 5.6 bcfd in March.
    U.S. LNG exports averaged 6.7 bcfd so far in May down from a four-month low of 8.1 bcfd in April and
a record 8.7 bcfd in February.
    
                                       Week ended      Week ended    Year ago   Five-year   
                                          May 15        May 8         May 15     average    
                                        (Forecast)      (Actual)                  May 15    
 U.S. natgas storage (bcf):                +83            +103         +101        +87      
                                                                                            
                                                                                            
 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                              22             26           44          47           44
 U.S. GFS CDDs                             125            119          107          99           96
 U.S. GFS TDDs                             147            145          151         146          140
                                                                                            
 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              90.1           88.5         88.5        88.5         77.0
 U.S. Imports from Canada                  5.8            6.0          6.0         7.8          7.8
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.1
 Total U.S. Supply                         95.9           94.4         94.5        95.3         84.9
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.1            2.1          2.1         2.6          1.9
 U.S. Exports to Mexico                    4.6            4.8          4.7         4.3          3.9
 U.S. LNG Exports                          6.6            5.9          5.7         5.6          2.0
 U.S. Commercial                           7.9            5.4          4.7         5.5          5.5
 U.S. Residential                          10.2           5.6          4.0         5.9          6.1
 U.S. Power Plant                          25.1           27.0         29.5        26.8         25.3
 U.S. Industrial                           22.6           21.7         21.5        21.8         20.6
 U.S. Plant Fuel                           4.5            4.4          4.4         4.3          4.5
 U.S. Pipe Distribution                    1.9            1.8          1.8         1.7          1.9
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    72.4           65.9         65.9        66.1         64.0
 Total U.S. Demand                         85.7           78.7         78.4        78.6         71.8
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.85           1.77                              
 Transco Z6 New York NG-CG-NY-SNL        1.48           1.42                              
 PG&E Citygate NG-CG-PGE-SNL             2.61           2.57                              
 Dominion South NG-PCN-APP-SNL           1.47           1.54                              
 Chicago Citygate NG-CG-CH-SNL           1.74           1.66                              
 Algonquin Citygate NG-CG-BS-SNL         1.52           1.33                              
 SoCal Citygate NG-SCL-CGT-SNL           1.99           1.80                              
 Waha Hub NG-WAH-WTX-SNL                 1.69           1.49                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             22.75          24.25                              
 PJM West EL-PK-PJMW-SNL                20.50          16.00                              
 Ercot North EL-PK-ERTN-SNL             28.00          42.00                              
 Mid C EL-PK-MIDC-SNL                    8.50           9.25                              
 Palo Verde EL-PK-PLVD-SNL              12.00          13.50                              
 SP-15 EL-PK-SP15-SNL                    9.75          11.25                              
 
 (Reporting by Scott DiSavino; Editing by Bernadette Baum and Richard Chang)
  
 
 
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