June 8, 2020 / 6:47 PM / a month ago

UPDATE 1-U.S. natgas futures edge up as slowing output offset LNG export drop

 (Adds closing prices)
    June 8 (Reuters) - U.S. natural gas futures edged up on Monday as a slowdown in output offset
forecasts for lower air conditioning demand and a drop in liquefied natural gas exports.
    Front-month gas futures rose 0.7 cents, or 0.4%, to settle at $1.789 per million British
thermal units.
    Refinitiv said gas production in the U.S. Lower 48 states fell to an average of 88.5 billion cubic
feet per day (bcfd) so far in June from a one-year low of 89.2 bcfd in May and an all-time monthly high
of 95.4 bcfd in November.
    In the Gulf of Mexico, output dipped about 0.6 bcfd over the weekend to around 15.4 bcfd as Tropical
Storm Cristobal hit the Louisiana coast on Sunday.
    With the coming of milder weather in mid-June, Refinitiv projected U.S. demand, including exports,
would slide from 81.1 bcfd this week to 80.5 bcfd next week. That was lower than Refinitiv's forecasts
on Friday.
    The amount of pipeline gas flowing to U.S. LNG export plants fell to an average of 4.2 bcfd so far
in June, down from an eight-month low of 6.4 bcfd in May and a monthly record high of 8.7 bcfd in
February. 
    Analysts said U.S. LNG exports dropped in recent months as buyers canceled cargoes due to a collapse
in European gas prices. After collapsing to a record low in late May, major European
benchmarks have soared around 60% so far in June, making gas in Europe more
expensive than in the United States for all forward months for the first time since late April.

    When U.S. gas was trading at a premium to the European benchmarks in May, some energy firms decided
to send at least a couple of cargoes to the United States for storage.
        
                                       Week ended      Week ended    Year ago   Five-year   
                                           Jun 5        May 29        Jun 5      average    
                                         (Actual)       (Actual)                  Jun 5     
 U.S. natgas storage (bcf):                +104           +102         +107        +94      
                                                                                            
                                                                                            
 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                              10             12           14          14           15
 U.S. GFS CDDs                             168            163          137         158          144
 U.S. GFS TDDs                             178            175          151         172          159
                                                                                            
 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              88.7           88.4         88.4        90.0         77.5
 U.S. Imports from Canada                  6.2            6.2          6.5         7.9          7.9
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.1
 Total U.S. Supply                         95.0           94.5         94.9        97.9         85.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.2            2.4          2.4         2.5          1.9
 U.S. Exports to Mexico                    5.1            5.1          4.9         5.0          4.1
 U.S. LNG Exports                          5.2            4.0          4.2         5.3          1.9
 U.S. Commercial                           4.6            4.5          4.5         4.6          4.7
 U.S. Residential                          3.9            3.8          3.8         3.9          4.1
 U.S. Power Plant                          32.3           33.6         33.0        31.3         31.0
 U.S. Industrial                           21.3           21.3         21.4        21.3         20.4
 U.S. Plant Fuel                           4.4            4.4          4.4         4.4          4.5
 U.S. Pipe Distribution                    1.8            1.9          1.8         1.8          1.9
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    68.6           69.6         69.0        67.4         66.7
 Total U.S. Demand                         81.1           81.1         80.5        80.2         74.6
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.80           1.68                              
 Transco Z6 New York NG-CG-NY-SNL        1.34           1.45                              
 PG&E Citygate NG-CG-PGE-SNL             2.47           2.56                              
 Dominion South NG-PCN-APP-SNL           1.31           1.40                              
 Chicago Citygate NG-CG-CH-SNL           1.59           1.70                              
 Algonquin Citygate NG-CG-BS-SNL         1.59           1.63                              
 SoCal Citygate NG-SCL-CGT-SNL           2.05           2.06                              
 Waha Hub NG-WAH-WTX-SNL                 1.44           1.56                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             24.00          23.75                              
 PJM West EL-PK-PJMW-SNL                22.50          28.00                              
 Ercot North EL-PK-ERTN-SNL             28.00          27.25                              
 Mid C EL-PK-MIDC-SNL                    1.57           2.13                              
 Palo Verde EL-PK-PLVD-SNL              16.00          33.00                              
 SP-15 EL-PK-SP15-SNL                   12.50          22.75                              
 
 (Reporting by Scott DiSavino; Editing by Richard Chang)
  
 
 
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