US natgas prices hold near 3-week low on record output, mild weather

By Scott DiSavino

(Reuters) -U.S. natural gas futures held near a three-week low on Friday on record output and forecasts for milder weather and lower heating demand than previously expected through early April.

Front-month gas futures for April delivery on the New York Mercantile Exchange rose 0.5 cent, or 0.1%, to settle at $3.980 per million British thermal units (mmBtu). On Thursday, the contract closed at its lowest since February 28.

For the week, the contract was down about 3%.Low gas demand expected in coming weeks should allow utilities to keep adding fuel to storage.

Some analysts say gas stockpiles are on track to increase in March for the first time since 2012 and only the second time in history.

So far, however, gas stockpiles remain around 8% below normal levels for this time of year after extremely cold weather in January and February forced energy firms to pull large amounts of gas out of storage, including record amounts in January. [EIA/GAS] [NGAS/POLL]

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states rose to 105.9 billion cubic feet per day (bcfd) so far in March, up from a record 105.1 bcfd in February.

Meteorologists projected temperatures in the Lower 48 states would remain mostly warmer than normal through April 5.

LSEG forecast average gas demand in the Lower 48, including exports, will rise from 106.8 bcfd this week to 108.0 bcfd next week before sliding to 106.1 bcfd in two weeks. The forecasts for this week and next week were similar to LSEG's outlook on Thursday.

The amount of gas flowing to the eight big operating U.S. LNG export plants rose to an average of 15.7 bcfd so far in March, up from a record 15.6 bcfd in February, as new units at Venture Global's 3.2-bcfd Plaquemines LNG export plant, currently under construction in Louisiana, enter service.

On a daily basis, LNG feedgas was on track to hit a preliminary record high of 16.6 bcfd on Friday, up from 16.0 bcfd on Thursday and an average of 15.9 bcfd over the prior seven days. If correct, that would top the current all-time daily high of 16.4 bcfd set on February 23.

The U.S. became the world's biggest LNG supplier in 2023, surpassing Australia and Qatar, as surging global prices fed demand for more exports due in part to supply disruptions and sanctions linked to Russia's 2022 invasion of Ukraine.

Gas traded around $14 per mmBtu at both the Dutch Title Transfer Facility (TTF) benchmark in Europe and the Japan Korea Marker (JKM) benchmark in Asia. [NG/EU]

  Week ended Week ended Year ago Five-year  

Mar 21 Mar 14 Mar 21 average  

Forecast Actual Mar 21

U.S. weekly natgas storage change (bcf): +11 +9 -30 -31  

U.S. total natgas in storage (bcf): 1,718 1,707 2,301 1,866  

U.S. total storage versus 5-year average -7.9% -10.0%      

Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five-Year

Last Year Average Average

2024 (2019-2023)

Henry Hub 3.92 3.98 1.75 2.41 3.52

Title Transfer Facility (TTF) 13.92 13.67 8.54 10.95 15.47

Japan Korea Marker (JKM) 13.53 13.78 8.95 11.89 15.23

LSEG 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 211 231 255 246 236

U.S. GFS CDDs 30 25 10 20 18

U.S. GFS TDDs 241 256 265 266 254

LSEG U.S. Weekly GFS Supply and Demand Forecasts          

  Prior Week Current Next Week This Week Five-Year

Week Last Year (2020-2024)

Average For

Month

U.S. Supply (bcfd)          

U.S. Lower 48 Dry Production 105.7 106.1 105.6 101.6 97.5

U.S. Imports from Canada 9.1 8.8 9.0 N/A 7.8

U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1

Total U.S. Supply 114.7 114.8 114.5 N/A 105.4

U.S. Demand (bcfd)          

U.S. Exports to Canada 3.8 4.0 3.9 N/A 3.3

U.S. Exports to Mexico 6.2 5.9 6.2 N/A 5.4

U.S. LNG Exports 15.5 16.0 16.4 13.1 11.8

U.S. Commercial 11.2 10.3 10.7 11.9 11.8

U.S. Residential 17.2 15.6 15.6 17.7 18.3

U.S. Power Plant 25.9 24.0 24.0 30.8 27.5

U.S. Industrial 23.7 23.5 23.7 24.5 23.8

U.S. Plant Fuel 5.2 5.2 5.2 5.2 5.2

U.S. Pipe Distribution 2.3 2.2 2.2 2.5 3.3

U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.2

Total U.S. Consumption 85.6 80.9 81.5 92.7 90.1

Total U.S. Demand 111.1 106.8 108.0 N/A 110.6

N/A is Not Available          

U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam 2025 2025 2024 2023 2022

(Fiscal year ending Sep 30) Current Day  Prior Day % of Normal % of Normal % of Normal

% of Normal % of Normal Actual Actual Actual

Forecast Forecast

Apr-Sep  91 92 74 83 107

Jan-Jul 88 89 76 77 102

Oct-Sep 89 90 77 76 103

U.S. weekly power generation percent by fuel - EIA          

  Week ended Week ended 2024 2023 2022

Mar 21 Mar 14

Wind 18 15 11 10 11

Solar 6 7 5 4 3

Hydro 7 7 6 6 6

Other 1 1 1 2 2

Petroleum 0 0 0 0 0

Natural Gas 32 34 42 41 38

Coal 14 16 16 17 21

Nuclear 20 20 19 19 19

SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)          

Hub Current Day Prior Day      

Henry Hub 4.23 4.21      

Transco Z6 New York  3.31 3.34      

PG&E Citygate  3.75 3.86      

Eastern Gas (old Dominion South)  3.27 3.33      

Chicago Citygate  3.35 3.69      

Algonquin Citygate  3.55 3.54      

SoCal Citygate  3.71 3.88      

Waha Hub  1.12 0.77      

AECO 1.51 1.46      

ICE U.S. Power Next-Day Prices ($ per megawatt-hour)          

Hub Current Day Prior Day      

New England 40.00 45.92      

PJM West 49.96 50.42      

Mid C 24.08 33.77      

Palo Verde 8.38  11.16      

SP-15 2.60 1.42      

(Reporting by Scott DiSavino; Editing by Joe Bavier and Marguerita Choy)