Sept 27 (Reuters) - U.S. natural gas futures slid about 2% on Tuesday to a 10-week low as Hurricane
Ian advanced toward Florida and on forecasts for milder weather over the next two weeks that will likely cut
gas demand and allow utilities to inject more fuel into storage.
The U.S. National Hurricane Center (NHC) projected Ian, after battering Cuba, would cross the Gulf of
Mexico and slam into southwest Florida on Wednesday as a major storm with winds of up to 120 miles (193
kilometers) per hour.
With most of the nation's gas production located away from the Gulf of Mexico in shale basins like the
Permian in West Texas, analysts said tropical storms were more demand-destroying events, since they knock out
power and can cause liquefied natural gas (LNG) export terminals to shut.
Only about 2% of U.S. gas production comes from the federal offshore Gulf of Mexico.
In other hurricane news, there were still about 503,000 customers in Puerto Rico and 139,000 in Nova
Scotia without power after Hurricane Fiona battered the U.S. island on Sept. 18 and the Canadian province on
Sept. 24.
Another factor weighing on gas prices was the expectation that demand would decline in October when the
Cove Point LNG plant in Maryland shuts for a couple weeks of maintenance. Cove Point consumes about 0.8
billion cubic feet per day (bcfd) of gas.
U.S. gas use has already been reduced for months by the ongoing outage at the Freeport LNG export plant in
Texas, which has left more gas in the United States for utilities to inject into stockpiles for next winter.
Freeport, the second-biggest U.S. LNG export plant, was consuming about 2 bcfd of gas before it shut on
June 8. Freeport LNG expects the facility to return to at least partial service in early to mid-November.
On its second to last day as the front-month, gas futures for October delivery fell 14.3 cents, or
2.1%, to $6.760 per million British thermal units (mmBtu) at 9:26 a.m. EDT (1326 GMT), putting the contract on
track for its lowest close since July 14.
That kept the front-month in technically oversold territory, with a relative strength index (RSI) below 30
for a fourth day in a row for the first time since early July.
Despite recent declines, gas futures were still up about 85% so far this year as higher prices in Europe
and Asia keep demand for U.S. LNG exports strong. Global gas prices have soared due to supply disruptions and
sanctions linked to Russia's Feb. 24 invasion of Ukraine.
Gas was trading around $53 per mmBtu in Europe and $38 in Asia. That was an 8% gain
for prices in Europe due to leaks on the Nord Stream pipelines from Russia to Germany.
Russian gas exports via the three main lines into Germany - Nord Stream 1 (Russia-Germany), Yamal
(Russia-Belarus-Poland-Germany) and the Russia-Ukraine-Slovakia-Czech Republic-Germany route - have averaged
just 1.3 bcfd so far in September, down from 2.5 bcfd in August and 10.8 bcfd in September 2021.
Data provider Refinitiv said average gas output in the U.S. Lower 48 states has risen to 98.8 bcfd so far
in September from a monthly record of 98.0 bcfd in August.
With cooler autumn weather coming, Refinitiv projected average U.S. gas demand, including exports, would
slip from 90.3 bcfd this week to 88.3 bcfd next week. The forecast for next week was lower than Refinitiv's
outlook on Monday.
Week ended Week ended Year ago Five-year
Sep 23 Sep 16 Sep 23 average
(Forecast) (Actual) Sep 23
U.S. weekly natgas storage change (bcf): +86 +103 +86 +77
U.S. total natgas in storage (bcf): 2,960 2,874 3,157 3,283
U.S. total storage versus 5-year average -9.8% -10.4% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
Last Year Average Average
2021 (2017-2021)
Henry Hub 6.97 6.90 5.11 3.73 2.89
Title Transfer Facility (TTF) 54.23 48.84 22.61 16.04 7.49
Japan Korea Marker (JKM) 37.69 37.57 23.35 18.00 8.95 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 58 55 24 63 80
U.S. GFS CDDs 72 76 89 85 71
U.S. GFS TDDs 130 131 113 148 151 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 98.3 98.7 99.2 93.5 87.0
U.S. Imports from Canada 8.0 7.8 7.5 8.3 7.7
U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1
Total U.S. Supply 106.2 106.5 106.7 101.8 95.8 U.S. Demand (bcfd)
U.S. Exports to Canada 2.1 1.9 1.9 2.0 2.4
U.S. Exports to Mexico 5.5 5.6 5.5 5.7 5.3
U.S. LNG Exports 11.5 11.7 11.3 10.3 4.9
U.S. Commercial 4.8 5.4 5.3 5.0 4.9
U.S. Residential 3.9 5.0 4.9 4.3 3.9
U.S. Power Plant 36.4 32.1 31.1 29.8 33.2
U.S. Industrial 21.3 21.7 21.4 20.7 21.2
U.S. Plant Fuel 4.9 4.9 4.9 4.9 4.9
U.S. Pipe Distribution 1.9 1.9 1.9 1.9 2.1
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 73.3 71.0 69.6 66.7 70.3
Total U.S. Demand 92.4 90.3 88.3 84.7 82.9 U.S. weekly power generation percent by fuel - EIA
Week ended Week ended Week ended Week ended Week ended
Sep 30 Sep 23 Sep 16 Sep 9 Sep 2
Wind 10 10 8 6 7
Solar 4 3 3 3 3
Hydro 5 5 5 6 5
Other 2 2 2 2 2
Petroleum 0 0 0 0 0
Natural Gas 39 41 42 45 44
Coal 18 19 19 21 21
Nuclear 21 19 19 18 17 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub 6.75 6.75
Transco Z6 New York 4.30 3.74
PG&E Citygate 7.69 7.30
Dominion South 4.16 3.76
Chicago Citygate 5.09 4.92
Algonquin Citygate 4.60 4.07
SoCal Citygate 8.90 5.75
Waha Hub 3.79 3.76
AECO 3.83 4.16 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day Prior Day
New England 51.75 38.50
PJM West 57.50 45.75
Ercot North 49.90 52.25
Mid C 108.00 139.00
Palo Verde 101.25 58.75
SP-15 105.50 60.25
(Reporting by Scott DiSavino; Editing by Jan Harvey)
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