US natural gas prices fall as power outages from Hurricane Helene reduce demand By Reuters

By Scott DiSavino

(Reuters) – U.S. crude fell about 1 percent on Monday due to a small rise in output over the weekend and forecasts weaker demand over the next two weeks than previously expected.

This small increase in production came as some drillers resumed production in the Gulf of Mexico now that Hurricane Helene has passed through the area.

The decline in demand, meanwhile, was partly due to a reduction in the number of gas-fired power generators likely to burn, with more than two million homes and businesses still without power in the Southeast and Midwest US after Helene hit region at the end of last week.

Front-month gas futures for November delivery on the New York Mercantile Exchange were down 1.9 cents, or 0.7 percent, at $2.883 per million British thermal units at 9:02 a.m. EDT (1302 GMT). . On Friday, the contract closed at its highest level since June 18.

Despite the small decline, the first month remained in technically overbought territory for the second day in a row, the first time since May.

For the month, the contract is up about 36%, the most in a month since July 2022.

For the previous quarter, the first month was up about 11% after rising 48% in the last quarter.

With gas futures up about 45% over the past five weeks, speculators increased their net long and options positions on the New York Mercantile and Intercontinental Exchanges for a fourth straight week, to the most highest level since early July, according to US Commodity Futures. Trading Commission Report on Merchant Commitments.

Meanwhile, in Canada, day-ahead gas prices at AECO’s Alberta hub fell to 4 cents per mmBtu, the lowest level since hitting a record low of about 2 cents in August 2022, according to company data financial LSEG since 1993.

SUPPLY AND DEMAND

LSEG said gas production in the 48 U.S. states fell to an average of 102.1 bcfd so far in September, down from 103.2 bcfd in August. That compares with a record 105.5 bcfd in December 2023.

Average production for September, however, was higher than seen last week as some production in the Gulf of Mexico came back online.

LSEG forecasts that average gas demand in the Lower 48 states, including exports, will increase from 95.9 bcfd this week to 96.6 bcfd next week. Those forecasts were lower than Friday’s LSEG outlook.

Gas flows to the seven major US liquefied natural gas (LNG) export plants fell to an average of 12.7 bcfd so far in September, down from 12.9 bcfd in August. This compares with a monthly record of 14.7 bcfd in December 2023.

That reduction was primarily due to the planned Sept. 20 shutdown of Berkshire Hathaway (NYSE: ) Energy’s 0.8 bcfd Cove Point LNG export plant in Maryland for about three weeks of annual maintenance.

The US has become the world’s biggest LNG supplier in 2023, ahead of recent leaders Australia and Qatar, as much higher global prices fuel demand for more exports due to supply disruptions and sanctions linked to Russia’s invasion of Ukraine.

Gas prices traded around a six-week high of $13 per mmBtu on the benchmark Dutch Title Transfer Facility (TTF) in Europe and a one-week high of $13 on the benchmark Japan Korea Marker (JKM ) in Asia. (NG/EU)

Week ended Week ended One year ago Five years

Sept. 27 Sept. 20 Sept. 27 avg

Current Real September 27

Weekly US nat gas storage change (bcf): +60 +47 +87 +98

Total US natural gas in storage (bcf): 3,552 3,492 3,420 3,357

Total US storage versus 5-year average 5.8% 7.1%

Global Gas Benchmarks ($ per mmBtu) Current Day Previous Day This Month Previous Year Five Years

Average last year

2023 (2018-2022)

Henry Hub 2.93 2.90 2.70 2.66 3.60

Title transfer facility (TTF) 12.68 12.47 11.44 13.04 14.39

Japan Korea Marker (JKM) 13.21 13.19 13.92 14.39 14.31

LSEG Heating (HDD), Cooling (CDD) and Total Degree Days (TDD).

Total forecast for two weeks Current day Previous day Previous year 30-year 10-year norm

Norm

US 50 51 65 77 94 GFS HDDs

US GFS CDDs 94 97 75 75 61

US GFS TDDs 144 148 130 152 155

GFS Weekly US LSEG Supply and Demand Forecasts

Previous week Current next week This week Five years

Last Year’s Week (2019-2023)

Average For

Month

US supply (bcfd)

Lower US dry production 48 101.8 102.2 102.2 102.3 96.5

US imports from Canada 7.9 7.6 7.4 N/A 7.1

US LNG imports 0.0 0.0 0.0 0.0 0.0

Total US Supply 109.7 109.9 109.6 N/A 103.6

US demand (bcfd)

US exports to Canada 1.9 2.0 1.9 N/A 2.3

US Exports to Mexico 6.2 6.1 6.8 N/A 6.0

US LNG exports 12.3 12.4 13.0 12.7 8.2

US Commercial 4.8 4.9 5.3 5.0 4.9

US Residential 4.0 4.0 4.7 4.2 3.9

US Power Plant 40.2 37.2 35.6 35.4 36.0

US Industrial 21.9 21.9 22.1 21.7 21.7

US vegetable fuel 5.0 5.0 5.0 5.0 5.1

US Pipeline Distribution 2.1 2.0 2.0 2.0 2.2

US Vehicle Fuel 0.1 0.1 0.1 0.1 0.1

Total US consumption 78.1 75.3 74.9 73.4 80.0

Total US demand 98.5 95.9 96.6 N/A 90.4

N/A is not available

US Northwest River Forecast Center (NWRFC) at The Dalles Dam Current Day Before Day 2023 2022 2021 %

% of normal % of normal % of normal % of normal of normal

Forecast Forecast Real Real Real

Apr-Sept 74 74 83 107 81

Jan-Jul 76 76 77 102 79

Oct-Sep 77 78 76 103 81

Percentage of weekly US energy generation by fuel – EIA

Week ended Week ended 2023 2022 2021

4 October 27 September

Wind 7 7 10 11 10

Solar 4 5 4 3 3

Hydro 5 5 6 6 7

Other 1 1 2 2 2

Petrol 0 0 0 0 0

Natural gas 44 46 41 38 37

Coal 18 18 17 21 23

Nuclear 20 18 19 19 20

SNL US Natural Gas Next Day Prices ($ per mmBtu)

Hub current day previous day

Henry Hub 2.53 2.64

Transco Z6 New York 1.28 1.23

PG&E (NYSE: ) Citygate 3.05 3.00

Eastern Gas (formerly Dominion South) 1.32 1.21

Chicago Citygate 2.35 2.52

Algonquin Citygate 1.55 1.65

SoCal Citygate 2.55 2.47

Waha Hub 0.96 1.39

AECO 0.04 0.07

SNL US Power Day-Ahead Prices ($ per megawatt-hour)

Hub current day previous day

New England 32.25 36.50

PJM West 43.25 37.00

North Ercot 21.50 25.25

Mid C 49.25 50.50

Palo Verde 29.50 36.00

SP-15 28.25 34.75