Reuters - U.S. Natural Gas Futures Little Changed On Steady Hot Forecasts

U.S. natgas futures little changed on steady hot forecasts - Reuters News

18-Jul-2016 09:05:12 AM

July 18 (Reuters) - U.S. natural gas futures on Monday traded little changed on mostly steady weather forecasts calling for hotter-than-normal weather for the next two weeks, with temperatures peaking from this Thursday to Sunday.

That is expected to keep power demand for gas at record highs to meet air conditioning demand.
After losing about 8 percent over the past two weeks despite above-normal heat, front-month gas futures NGc1 for August delivery on the New York Mercantile Exchange were a fraction of a cent, or 0.1 percent, lower, at $2.752 per million British thermal units at 9:56 a.m. EDT (1356 GMT).
Next-day prices, meanwhile, remained relatively low despite weeks of smaller-than-usual storage additions in part because the amount of gas in inventory has been at all-time highs since April after the warmer-than-normal winter of 2015-2016. NGAS/POLL
In early estimates, analysts said utilities likely added just 37 billion cubic feet of gas into storage during the week ended July 15. That compared with builds of 64 bcf in the prior week, 70 bcf a year earlier and a five-year average of 61 bcf. EIA/GAS
Spot prices at the Henry Hub benchmark GT-HH-IDX have averaged $2.11 so far this year, while futures for the balance of 2016 NGBALst were fetching $2.90. That compares with $2.61 in 2015, the lowest since 1999.
Those low prices have prompted power generators to burn record amounts of gas instead of coal, while producers reduce output as they wait for prices to rise. Futures for calendar year 2017 NGYstc1 were trading at $3.17.
The U.S. power sector has burned an average 26.2 bcf per day so far in 2016, topping the record 24.7 bcfd of a year earlier. Generators are expected to burn more than 40 bcfd on several days over the next two weeks to meet air conditioning demand, according to Thomson Reuters data.
U.S. drillers have reduced average dry gas output in the lower 48 states to 73.0 bcfd year to date from a record 73.5 bcfd in 2015.

	Week ended July 15 (Forecast)	Week ended July 8(Actual)	Year Ago	5-year Average
U.S. natgas storage (change in bcf):	37	64	70	61
Heating & Cooling Degree Days
Two-Week Total Forecast	Current Day	Prior Day	30-Year Norm
GFS HDDs	1	2	2
GFS CDDs	262	257	202
EC HDDs	3	2	2
EC CDDs	232	236	189
GFS Gas Consumption (bcfd)
Two-Week Average Forecast	Current Day	Prior Day	30-Year Norm
Residential	3.7	3.6	3.7
Commercial	4.4	4.4	4.4
Power	38.8	37.6	29.4
Industrial	20.0	20.0	20.6
Total	66.8	65.5	58.1
EC Gas Consumption (bcfd)
Two-Week Average Forecast	Current Day	Prior Day	30-Year Norm
Residential	3.7	3.6	3.7
Commercial	4.4	4.4	4.4
Power	37.3	37.3	29.4
Industrial	19.8	19.9	20.5
Total	65.2	65.2	58.0
Thomson Reuters Supply Chain & Commodities Research (SC&CR)Supply Estimates (bcfd):
	Current Day	Prior Day	Prior Year	High since 2011
U.S. Lower 48 dry production	71.8	71.2	74.6	75.2
Net U.S. imports from Canada	6.8	6.6	5.4	8.3
U.S. LNG imports	0.2	0.2	0.3	2.8
U.S. LNG exports	0.7	0.7		0.8
U.S. exports to Mexico	3.8	3.7	3.3	4.3
U.S. gas used due to nuclear outages	0.2	0.1
ICE U.S. Natural Gas Next-Day Prices ($ per mmBtu):
Hub	Current Day	Prior Day
Algonquin E-ALGCIT-IDX		2.76
Dominion South E-DOMSP-IDX		1.33
New York E-TSCO6NY-IDX		1.78
Henry Hub GT-HH-IDX		2.66
Chicago MC-CHICIT-IDX		2.63
SoCal Border W-SOBOR-IDX		2.54
ICE U.S. Power Next-Day Prices ($ per megawatt-hour):
Hub	Current Day	Prior Day
Ercot North SE-ERCONP-IDX		36.00
Mid C W-MIDCP-IDX		22.16
New England E-NEPLMHP-IDX
Palo Verde W-PVP-IDX		39.93
PJM West E-PJWHRTP-IX		47.13
SP-15 W-SP15-IDX		36.50

(Reporting by Scott DiSavino Editing by W Simon)

(( scott.disavino@thomsonreuters.com ; +1 646 223-6072; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net ))

For Thomson Reuters Supply Chain & Commodities Research (SC&CR), formerly known as Thomson Reuters Analytics, see: Open
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For graphics on Baker Hughes rig counts, see:
http://graphics.thomsonreuters.com/15/rigcount/index.html
    
For next-day ICE U.S. gas prices, see: 0#GAS-IDX=ICE
    
For next-day ICE U.S. power prices, see: 0#POWER-IDX=ICE
For U.S. natgas price and storage polls, see: NGAS/POLL
For U.S. nuclear power outages, see: NUKE/ 
    
For U.S. Northwest hydro power report, see: NWRFC
    
For U.S. natural gas inventories vs five-year range, see: http://link.reuters.com/deh95w
For natural gas rig count vs futures price, see: http://link.reuters.com/nuz86t

Keywords: USA-NATGAS/NYMEX

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