July 27, 2020 / 12:58 PM / 12 days ago

U.S. natgas futures slide as output rises, cooling demand eases

    July 27 (Reuters) - U.S. natural gas futures on Monday started the week lower as output slowly rises
and cooling demand eases.
    Meteorologists projected temperatures will remain warmer than normal through at least mid August but
noted the hottest days of summer were likely past.
    Front-month gas futures fell 3.4 cents, or 1.9%, to $1.774 per million British thermal units
at 8:37 a.m. EDT (1237 GMT).
    Speculators, meanwhile, increased their long positions for a sixth week in a row to their highest
since December 2018 on hopes energy demand will rise later this year if economic activity increases once
governments lift coronavirus lockdowns.
    Refinitiv said production in the Lower 48 U.S. states averaged 88.5 billion cubic feet per day
(bcfd) 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 projected U.S. demand, including exports, will slide from 91.5 bcfd this week to 90.8 bcfd
next week. The forecast for next week is well below Refinitiv's 93.4-bcfd outlook on Friday.
    Pipeline gas flowing to U.S. LNG export plants averaged 3.3 bcfd (34% 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.
    U.S. pipeline exports, meanwhile, rose as consumers in neighboring countries cranked up their air
conditioners.
    Refinitiv said pipeline exports to Canada averaged 2.4 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 5.63 bcfd so far this month, up from 5.44 bcfd in June and on track to top the record 5.55 bcfd
in March.
    
                                       Week ended      Week ended    Year ago   Five-year   
                                          Jul 24         Jul 17       Jul 24     average    
                                        (Forecast)      (Actual)                  Jul 24    
 U.S. natgas storage (bcf):                +29            +37          +56         +33      
                                                                                            
                                                                                            
 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                              1              1            1           3            2
 U.S. GFS CDDs                             228            235          219         207          199
 U.S. GFS TDDs                             229            236          220         210          201
                                                                                            
 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              89.0           89.1         88.9        91.4         78.1
 U.S. Imports from Canada                  6.8            6.7          7.0         8.1          8.2
 U.S. LNG Imports                          0.0            0.0          0.0         0.0          0.2
 Total U.S. Supply                         95.8           95.8         95.9        98.4         86.5
 
 U.S. Demand (bcfd)
 U.S. Exports to Canada                    2.4            2.5          2.5         2.6          2.0
 U.S. Exports to Mexico                    5.8            5.7          6.0         5.1          4.2
 U.S. LNG Exports                          3.7            3.3          4.4         5.9          2.1
 U.S. Commercial                           4.4            4.4          4.4         4.4          4.4
 U.S. Residential                          3.5            3.5          3.5         3.5          3.5
 U.S. Power Plant                          44.9           44.1         42.4        41.6         37.2
 U.S. Industrial                           21.4           21.4         21.4        21.5         20.3
 U.S. Plant Fuel                           4.4            4.4          4.4         4.4          4.4
 U.S. Pipe Distribution                    2.2            2.1          2.1         2.1          2.1
 U.S. Vehicle Fuel                         0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                    80.8           80.0         78.4        77.6         72.0
 Total U.S. Demand                         92.7           91.5         90.8        91.2         80.3
                                                                                            
                                                                                            
 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)                                         
 Hub                                   Current Day     Prior Day                            
 Henry Hub NG-W-HH-SNL                   1.77           1.75                              
 Transco Z6 New York NG-CG-NY-SNL        1.78           1.74                              
 PG&E Citygate NG-CG-PGE-SNL             2.41           2.37                              
 Dominion South NG-PCN-APP-SNL           1.24           1.20                              
 Chicago Citygate NG-CG-CH-SNL           1.66           1.65                              
 Algonquin Citygate NG-CG-BS-SNL         1.72           1.51                              
 SoCal Citygate NG-SCL-CGT-SNL           1.68           1.67                              
 Waha Hub NG-WAH-WTX-SNL                 1.09           1.30                              
                                                                                            
 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)                                       
 Hub                                   Current Day     Prior Day                            
 New England EL-PK-NPMS-SNL             28.75          28.25                              
 PJM West EL-PK-PJMW-SNL                32.50          27.75                              
 Ercot North EL-PK-ERTN-SNL             26.50          42.50                              
 Mid C EL-PK-MIDC-SNL                   44.20          15.57                              
 Palo Verde EL-PK-PLVD-SNL              24.25          19.00                              
 SP-15 EL-PK-SP15-SNL                   25.25          22.75                              
 
 (Reporting by Scott DiSavino; Editing by Steve Orlofsky)
  
 
 
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