July 15, 2020 / 12:29 PM / 24 days ago

U.S. natgas futures flat as rising output offsets higher cooling demand

    July 15 (Reuters) - U.S. natural gas futures were little changed on Wednesday as slowly rising
output and declining liquefied natural gas exports offset an increase in pipeline exports and a forecast
rise in air conditioning demand over the next two weeks.
    Front-month gas futures remained unchanged at $1.743 per million British thermal units at
8:07 a.m. EDT (1207 GMT).
    Looking ahead, futures for the balance of 2020 and calendar 2021 were trading
26% and 51%, respectively, over the front-month, on hopes energy demand will rise as the economy
rebounds as state governments lift coronavirus-linked lockdowns.
    Refinitiv said production in the Lower 48 U.S. states averaged 88.1 billion cubic feet per day
(bcfd) so far in July, up from a 20-month low of 87.0 bcfd in June but still well below the all-time
monthly high of 95.4 bcfd in November.
    Refinitiv forecast U.S. demand, including exports, will rise from 90.8 bcfd this week to 93.6 bcfd
next week. That was higher than Refinitiv's outlook on Tuesday.
    Pipeline gas flowing to U.S. LNG export plants averaged 3.2 bcfd (33% utilization) so far in July,
down from a 20-month low of 4.1 bcfd in June and a record 8.7 bcfd in February. Utilization was about
90% in 2019. Flows to Freeport in Texas held at zero for an ninth straight day for the first time since
July 2019 when the first of its three liquefaction trains was in test mode.
    U.S. pipeline exports, meanwhile, rose as consumers in neighboring countries cranked up their air
conditioners.
    Refinitiv said pipeline exports to Canada averaged 2.5 bcfd so far in July, up from 2.3 bcfd in
June, but still below the all-time monthly high of 3.5 bcfd in December. Pipeline exports to Mexico
averaged 5.5 bcfd this month, up from 5.4 bcfd in June, but below the record 5.6 bcfd in March.
        
                                       Week ended      Week ended    Year ago   Five-year   
                                          Jul 10         Jul 3        Jul 10     average    
                                        (Forecast)      (Actual)                  Jul 10    
 U.S. natgas storage (bcf):                +43            +56          +67         +63      
                                                                                            
                                                                                            
 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                              2              2            2           4            2
 U.S. GFS CDDs                             256            252          220         206          202
 U.S. GFS TDDs                             258            254          222         210          204
                                                                                            
 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              88.2           88.0         87.9        89.1         78.1
 U.S. Imports from Canada                  6.6            7.0          7.0         8.2          8.2
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.2
 Total U.S. Supply                         94.9           95.0         94.9        97.3         86.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.4            2.6          2.5         2.6          2.0
 U.S. Exports to Mexico                    5.4            5.6          5.5         4.7          4.2
 U.S. LNG Exports                          3.1            3.3          3.6         5.9          2.1
 U.S. Commercial                           4.3            4.3          4.4         4.4          4.4
 U.S. Residential                          3.5            3.5          3.5         3.5          3.5
 U.S. Power Plant                          42.7           43.4         46.0        42.3         37.2
 U.S. Industrial                           21.3           21.5         21.5        21.5         20.3
 U.S. Plant Fuel                           4.4            4.3          4.3         4.3          4.4
 U.S. Pipe Distribution                    2.1            2.1          2.2         2.1          2.1
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    78.4           79.3         82.0        78.2         72.0
 Total U.S. Demand                         89.4           90.8         93.6        91.4         80.3
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.74           1.75                              
 Transco Z6 New York NG-CG-NY-SNL        1.69           1.68                              
 PG&E Citygate NG-CG-PGE-SNL             2.59           2.69                              
 Dominion South NG-PCN-APP-SNL           1.20           1.31                              
 Chicago Citygate NG-CG-CH-SNL           1.66           1.71                              
 Algonquin Citygate NG-CG-BS-SNL         1.54           1.50                              
 SoCal Citygate NG-SCL-CGT-SNL           1.98           2.31                              
 Waha Hub NG-WAH-WTX-SNL                 1.34           1.39                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             20.50          23.75                              
 PJM West EL-PK-PJMW-SNL                27.75          30.50                              
 Ercot North EL-PK-ERTN-SNL             24.00          25.50                              
 Mid C EL-PK-MIDC-SNL                   19.38          17.67                              
 Palo Verde EL-PK-PLVD-SNL              43.50          46.75                              
 SP-15 EL-PK-SP15-SNL                   28.50          32.00                              
 
 (Reporting by Scott DiSavino; Editing by Bernadette Baum)
  
 
 
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