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Oil report

UPDATE 1-U.S. natgas futures slide 2% as output rises, demand slips

 (Updates prices)
    May 27 (Reuters) - U.S. natural gas futures slid about 2% to a one-week low on Friday on rising output and
lowered forecasts for demand over the next two weeks.
    This week, U.S. power generators burned more gas for a second week in a row due to low wind power, on
track to produce just 11% of U.S. power this week, down from a recent high of 16%. Gas will generate about
36%, up from a recent low of 33%, according to federal data.
    After last week's smaller than usual storage build, traders noted that extra gas burned by power
generators will limit what utilities have available to inject into storage again this week.

    On its first day as the front-month, gas futures for July delivery fell 16.8 cents, or 1.9%, to
settle at $8.727 per million British thermal units (mmBtu), their lowest close since May 20.
    When June was still the front-month, the contract closed at its highest since August 2008 on Tuesday and
Wednesday.
    For the week, the front-month was up about 8% after rising about 5% last week.
    U.S. gas futures are up about 134% so far this year as much higher prices in Europe and Asia keep demand
for U.S. liquefied natural gas (LNG) exports strong, especially since Russia's Feb. 24 invasion of Ukraine
stoked fears Moscow might cut gas supplies to Europe. 
    Even with much bigger supply worries in Europe, traders noted U.S. futures were up about 16% over the past
month, while European prices were down about 20% as Russia keeps sending supplies by pipeline and LNG vessels
continue to deliver lots of cargoes.
    Gas was currently trading around $27 per mmBtu in Europe and $23 in Asia. Gas
stockpiles in Northwest Europe were only about 10% below the five-year norm versus about 15% below in the
United States.
    U.S. futures, however, continue to lag far behind global prices because the United States is the world's
top producer with all the gas it needs for domestic use, while capacity constraints inhibit additional LNG
exports.
    Data provider Refinitiv said average gas output in the U.S. Lower 48 states has climbed to 95.0 billion
cubic feet per day (bcfd) so far in May from 94.5 bcfd in April, off the monthly record of 96.1 bcfd in
November 2021.
    Refinitiv projected average U.S. gas demand, including exports, would hold around 88.5 bcfd for through to
mid-June, lower than Refinitiv forecast on Thursday.
    The average amount of gas flowing to U.S. LNG export plants rose to 12.5 bcfd so far in May from 12.2 bcfd
in April. It hit a monthly record of 12.9 bcfd in March. The United States can turn about 13.6 bcfd of gas
into LNG.
    Since the United States will not be able to produce much more LNG soon, it worked with allies to divert
exports from elsewhere to Europe to help European Union countries and others break dependence on Russian gas
after Russia's invasion of Ukraine.
    Russia exported around 7.4 bcfd of gas to Europe on Thursday, the same as Wednesday, on the three
mainlines into Germany: North Stream 1 (Russia-Germany), Yamal (Russia-Belarus-Poland-Germany) and the
Russia-Ukraine-Slovakia-Czech Republic-Germany route. That compares with an average of 11.9 bcfd in May 2021.

                 
                                              Week ended     Week ended     Year ago   Five-year        
                                                May 27         May 20        May 27     average    
                                              (Forecast)      (Actual)                   May 27    
 U.S. weekly natgas storage change (bcf):         +91            +80          +100        +100          
 U.S. total natgas in storage (bcf):             1,903          1,812        2,299       2,239          
 U.S. total storage versus 5-year average       -15.0%         -15.3% 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                                       8.62           8.90          2.96        3.73        2.89
 Title Transfer Facility (TTF)                   26.65          27.00         8.88       16.04        7.49
 Japan Korea Marker (JKM)                        22.49          22.22         9.65       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                                    22             22            34          31          31
 U.S. GFS CDDs                                    137            130           90          98          120
 U.S. GFS TDDs                                    159            152          124         129          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                    95.1           95.1          94.8        92.5        83.9
 U.S. Imports from Canada                         7.6            7.3          7.7         7.3          7.6
 U.S. LNG Imports                                 0.0            0.0          0.0         0.0          0.1
 Total U.S. Supply                               102.7          102.4        102.6        99.8        92.6 U.S. Demand (bcfd)                                                                                     
 U.S. Exports to Canada                           2.8            2.6          2.6         2.1          2.1
 U.S. Exports to Mexico                           6.1            6.0          6.1         6.2          4.8
 U.S. LNG Exports                                12.2           13.0          13.1        10.5         5.1
 U.S. Commercial                                  5.0            5.1          4.6         5.0          5.6
 U.S. Residential                                 4.8            4.9          4.1         4.8          6.7
 U.S. Power Plant                                31.4           29.6          30.7        27.6        26.0
 U.S. Industrial                                 20.7           20.9          20.6        21.4        20.9
 U.S. Plant Fuel                                  4.7            4.7          4.7         4.7          4.6
 U.S. Pipe Distribution                           1.8            1.8          1.8         1.8          1.8
 U.S. Vehicle Fuel                                0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                          68.5           67.0          66.6        65.4        65.7
 Total U.S. Demand                               89.6           88.6          88.5        84.2        77.7 U.S. weekly power generation percent by fuel - EIA                                                
                                              Week ended     Week ended    Week ended  Week ended  Week ended
                                                May 27         May 20        May 13      May 6       Apr 29
 Wind                                             11             12            15          13          16
 Solar                                             4              4            4           4            4
 Hydro                                             8              7            7           7            7
 Other                                             2              2            2           2            2
 Petroleum                                         0              0            0           0            0
 Natural Gas                                      36             37            34          36          33
 Coal                                             20             20            18          19          19
 Nuclear                                          20             19            19          20          19 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
 Hub                                         Current Day    Prior Day                              
 Henry Hub NG-W-HH-SNL                         9.19           9.44                               
 Transco Z6 New York NG-CG-NY-SNL              8.13           8.23                               
 PG&E Citygate NG-CG-PGE-SNL                   10.24          10.41                              
 Dominion South NG-PCN-APP-SNL                 7.91           8.20                               
 Chicago Citygate NG-CG-CH-SNL                 8.63           8.89                               
 Algonquin Citygate NG-CG-BS-SNL               8.10           9.20                               
 SoCal Citygate NG-SCL-CGT-SNL                 9.75           10.06                              
 Waha Hub NG-WAH-WTX-SNL                       8.51           8.74                               
 AECO NG-ASH-ALB-SNL                           6.07           6.11 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
 Hub                                         Current Day                                           
 New England EL-PK-NPMS-SNL                    93.00          83.75                              
 PJM West EL-PK-PJMW-SNL                       84.50          84.50                              
 Ercot North EL-PK-ERTN-SNL                    93.75          85.50                              
 Mid C EL-PK-MIDC-SNL                          79.67          79.67                              
 Palo Verde EL-PK-PLVD-SNL                     90.00          90.00                              
 SP-15 EL-PK-SP15-SNL                          86.00          86.00                              
 
 (Reporting by Scott DiSavino; editing by David Evans and David Gregorio)
  
 
 
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