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Energy

UPDATE 4-U.S. natgas futures dive nearly 10% to 6-week low on big storage build

 (New throughout, updates prices, market activity and comments)
    Sept 17 (Reuters) - U.S. natural gas futures tumbled almost 10% to a six-week low on Thursday as a
bigger-than expected storage build last week kept stockpiles on track to reach record highs by the end
of October.
    The U.S. Energy Information Administration (EIA) said utilities injected 89 billion cubic feet
(bcf) of gas into storage in the week ended Sept. 11.
    That is higher than the 79-bcf build analysts forecast in a Reuters poll and compares with an
increase of 82 bcf during the same week last year and a five-year (2015-19) average build of 77 bcf.
    Even before the EIA released its report, prices were already under pressure with output expected to
rise from a two-year low as producers return wells shut-in for Hurricane Sally and on forecasts calling
for milder weather and lower cooling demand over the next two weeks.
    Front-month gas futures fell 22.5 cents, or 9.9%, to settle at $2.042 per million British
thermal units, their lowest since July 31. That was the contract's biggest one-day percentage loss
since January 2019.
    "The magnitude of today’s decline strongly suggested some margin call selling as remaining recently
acquired speculative longs were forced to liquidate," said Jim Ritterbusch, president of Ritterbusch
and Associates in Galena, Illinois.
    In recent weeks, speculators had boosted their net long positions to the highest in almost three
years despite expectations record stockpiles would make price spikes and gas shortages unlikely this
winter.
    Data provider Refinitiv said output in the Lower 48 U.S. states was on track to rise to 85.3
billion cubic feet per day (bcfd) on Thursday from a two-year low of 84.8 bcfd on Wednesday due to
Sally-related shutdowns.
    With cooler weather coming, Refinitiv projected demand, including exports, would fall from 85.3
bcfd this week to 81.9 bcfd next week.
                                 
                                       Week ended     Week ended    Year ago   Five-year   
                                         Sep 11         Sep 4        Sep 11     average    
                                        (Actual)       (Actual)                  Sep 11    
 U.S. natgas storage (bcf):                +89           +70          +82         +77 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                             47             40           14          24           54
 U.S. GFS CDDs                             74             80          149         130           86
 U.S. GFS TDDs                             121           120          163         154          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             88.4           86.3         85.9        93.3         79.7
 U.S. Imports from Canada                  5.8           5.7          6.5         7.8          7.9
 U.S. LNG Imports                          0.0           0.0          0.0         0.0          0.1
 Total U.S. Supply                        94.2           92.0         92.4       100.0         87.7
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.1           2.0          2.0         2.5          2.3
 U.S. Exports to Mexico                    6.0           5.8          6.1         5.6          4.5
 U.S. LNG Exports                          4.8           6.9          7.0         6.5          2.1
 U.S. Commercial                           4.8           4.9          5.3         4.7          4.7
 U.S. Residential                          4.0           4.1          4.9         3.8          3.7
 U.S. Power Plant                         34.3           33.8         28.8        35.8         32.0
 U.S. Industrial                          21.6           21.5         21.7        21.2         20.6
 U.S. Plant Fuel                           4.4           4.3          4.2         4.3          4.4
 U.S. Pipe Distribution                    1.9           1.9          1.8         1.9          1.9
 U.S. Vehicle Fuel                         0.1           0.1          0.1         0.1          0.1
 Total U.S. Consumption                   71.0           70.6         66.8        71.3         67.4
 Total U.S. Demand                        84.0           85.3         81.9        86.4         76.3 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                        
 Hub                                   Current Day    Prior Day                            
 Henry Hub NG-W-HH-SNL                  2.06           2.19                              
 Transco Z6 New York NG-CG-NY-SNL       0.96           1.29                              
 PG&E Citygate NG-CG-PGE-SNL            3.43           3.40                              
 Dominion South NG-PCN-APP-SNL          0.90           1.07                              
 Chicago Citygate NG-CG-CH-SNL          1.90           1.92                              
 Algonquin Citygate NG-CG-BS-SNL        1.25           1.25                              
 SoCal Citygate NG-SCL-CGT-SNL          2.80           2.57                              
 Waha Hub NG-WAH-WTX-SNL                1.39           1.50 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                      
 Hub                                   Current Day    Prior Day                            
 New England EL-PK-NPMS-SNL             23.00         20.00                              
 PJM West EL-PK-PJMW-SNL                22.00         18.50                              
 Ercot North EL-PK-ERTN-SNL             23.25         31.50                              
 Mid C EL-PK-MIDC-SNL                   36.25         33.42                              
 Palo Verde EL-PK-PLVD-SNL              30.50         34.25                              
 SP-15 EL-PK-SP15-SNL                   36.75         37.25                              
 
 (Reporting by Scott DiSavino
Editing by Nick Zieminski, Jonathan Oatis and David Gregorio)
  
 
 
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