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U.S. natural gas futures edged up about 1% to a fresh 13-year high on Wednesday on
forecasts for hotter weather and higher demand next week than previously expected, a decline in output, low
wind power and record power demand in Texas.
Power demand in Texas broke the June record on Monday and Tuesday and will keep rising this week until it
tops the all-time high as economic growth boosts usage and hot weather causes homes and businesses to crank up
their air conditioners.
Low wind power forces generators, including those in Texas – the state with the most wind power – to burn
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more gas to keep the lights on.
Front-month gas futures for July delivery rose 7.7 cents, or 0.8%, to $9.370 per million British
thermal units (mmBtu) at 8:55 a.m. EDT (1255 GMT), putting the contract on track for its highest close since
August 2008 for a second time this week.
U.S. gas futures were up about 150% so far this year as much higher prices in Europe and Asia keep demand
for U.S. LNG exports strong, especially since Russia’s Feb. 24 invasion of Ukraine stoked fears that Moscow
might cut gas supplies to Europe.
Gas was trading around $25 per mmBtu in Europe and $23 in Asia.
Traders said U.S. futures also soared in recent months due to low U.S. gas stockpiles – about 15% below
normal for this time of year – and high U.S. coal prices, which make it uneconomical for electric
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companies to switch from gas to coal for power generation.
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U.S. futures lag far behind global prices because the United States is the world’s top producer with all
the gas it needs for domestic use, while capacity constraints inhibit additional LNG exports.
Data provider Refinitiv said average gas output in the U.S. Lower 48 states fell to 94.8 billion cubic
feet per day (bcfd) so far in June from 95.1 bcfd in May. That compares with a monthly record of 96.1 bcfd in
December 2021.
With hotter weather coming, Refinitiv projected average U.S. gas demand, including exports, would from
rise from 90.8 bcfd this week to 94.9 bcfd next week. The forecast for next week was higher than Refinitiv’s
outlook on Tuesday.
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The average amount of gas flowing to U.S. LNG export plants rose to 12.8 bcfd so far in June from 12.5
bcfd in May. That compares with a monthly record of 12.9 bcfd in March. The United States can turn about 13.6
bcfd of gas into LNG.
The United States, which will not be able to produce much more LNG anytime soon, has worked with allies to
divert exports from elsewhere to Europe to help European Union countries and others break dependence on
Russian gas.
Russia cut pipeline exports to Europe to 6.8 bcfd on Tuesday from 6.9 bcfd on Monday on the three
mainlines into Germany: North Stream 1 (Russia-Germany), Yamal (Russia-Belarus-Poland-Germany) and the
Russia-Ukraine-Slovakia-Czech Republic-Germany route. That compares with an average of 11.6 bcfd in June 2021.
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Gas stockpiles in Northwest Europe – Belgium, France, Germany and the Netherlands – were
about 8% below the five-year (2017-2021) average for this time of year, and down from 39% below the five-year
norm in mid-March, according to Refinitiv. Storage was currently about 47% of full capacity.
That is much healthier than U.S. inventories, which were around 15% below their five-year norm.
Week ended Week ended Year ago Five-year
Jun 3 May 27 Jun 3 average
(Forecast) (Actual) Jun 3
U.S. weekly natgas storage change (bcf): +96 +90 +98 +100
U.S. total natgas in storage (bcf): 1,998 1,902 2,397 2,339
U.S. total storage versus 5-year average -14.6% -15.1%
Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year
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Last Year Average Average
2021 (2017-2021)
Henry Hub 9.29 9.29 3.27 3.73 2.89
Title Transfer Facility (TTF) 24.72 25.18 10.27 16.04 7.49
Japan Korea Marker (JKM) 22.87 23.36 11.58 18.00 8.95
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 9 9 5 15 16
U.S. GFS CDDs 197 190 182 150 149
U.S. GFS TDDs 206 199 187 165 165
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 95.5 94.8 95.1 93.1 84.6
U.S. Imports from Canada 7.4 7.8 7.5 7.8 7.7
U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1
Total U.S. Supply 102.9 102.6 102.7 99.9 92.4
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U.S. Demand (bcfd)
U.S. Exports to Canada 2.7 2.6 2.6 2.2 2.2
U.S. Exports to Mexico 6.0 6.0 6.1 6.7 5.1
U.S. LNG Exports 12.8 12.9 12.8 9.2 4.3
U.S. Commercial 4.6 4.5 4.4 4.5 4.7
U.S. Residential 4.1 3.8 3.6 3.8 4.3
U.S. Power Plant 28.2 33.5 37.2 36.1 32.8
U.S. Industrial 20.7 20.8 20.9 20.6 20.9
U.S. Plant Fuel 4.7 4.7 4.7 4.7 4.7
U.S. Pipe Distribution 1.7 1.8 1.9 1.7 1.8
U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1
Total U.S. Consumption 64.2 69.3 73.0 71.5 69.3
Total U.S. Demand 85.7 90.8 94.9 89.6 80.9
U.S. weekly power generation percent by fuel – EIA
Week ended Week ended Week ended Week ended Week ended
Jun 10 Jun 3 May 27 May 20 May 13
Wind 9 12 12 12 15
Solar 6 4 4 4 4
Hydro 7 7 7 7 7
Other 2 2 2 2 2
Petroleum 0 0 0 0 0
Natural Gas 39 36 37 37 34
Coal 20 19 20 20 18
Nuclear 20 19 19 19 19
SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
Hub Current Day Prior Day
Henry Hub 9.28 9.08
Transco Z6 New York 8.30 7.98
PG&E Citygate 10.08 9.82
Dominion South 8.15 7.81
Chicago Citygate 8.85 8.64
Algonquin Citygate 8.40 8.17
SoCal Citygate 10.20 9.70
Waha Hub 8.82 8.58
AECO 6.64 6.71
SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
Hub Current Day
New England 87.50 80.50
PJM West 109.25 101.50
Ercot North 93.75 99.25
Mid C 48.92 63.75
Palo Verde 102.00 78.25
SP-15 85.00 79.25
(Reporting by Scott DiSavino
Editing by Nick Zieminski)
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