NEW YORK: US natural gas futures were little changed on Thursday as the market waited for direction from a federal storage report that is expected to show that hot weather and high air-conditioning demand last week caused energy firms to add less gas to storage than usual for this time of year.
Front-month gas futures for November delivery on the New York Mercantile Exchange fell 0.6 cent, or 0.2percent, to USD3.02 per million British thermal units (mmBtu).
Analysts forecast energy firms added 64 billion cubic feet (bcf) of gas to storage during the week ended September 25.
That figure compares with an increase of 56 bcf during the same week last year and a five-year (2021-2025) average increase of 80 bcf for the period.
Financial firm LSEG said average gas output in the US Lower 48 states held at 113.3 billion cubic feet per day (bcfd) in September, matching the monthly record high in August.
Over the past week, however, output has averaged a much lower 110.7 bcfd, due in part to the force majeure that Canadian energy firm TC Energy’s Columbia Gas Transmission unit declared on the Mountaineer XPress gas pipe in West Virginia on September 24.
Columbia Gas Transmission lifted the force majeure on September 27 after fixing a mechanical issue that affected around 1.4 bcfd to 1.8 bcfd of gas flows.
Record output and mild spring weather have allowed energy firms to keep the amount of gas in inventory above the five-year (2021-2025) average since March, reaching a high of 7.7percent above normal in April.
But hotter-than-normal weather over the summer forced energy firms to pull lots of gas from storage to fuel the power plants needed to keep air conditioners humming, cutting the inventory surplus. About 40percent of US power generation comes from gas-fired plants.
Looking forward, meteorologists predicted average weather across the country would remain mostly near normal through October 16, which should keep both heating and cooling demand low.
As the weather turns seasonally cooler, LSEG said average gas demand in the Lower 48 states, including exports, will rise from 103.1 bcfd this week to 105.4 bcfd next week. The forecast for this week was higher than LSEG’s outlook on Wednesday.
LNG EXPORTS
Average gas flows to the nine large US LNG export plants rose to 17.9 bcfd in September, up from 17.2 bcfd in August, but remained short of the monthly record high of 18.8 bcfd in April.
The increase in average LNG feedgas in September occurred despite the shutdown of US energy firm Berkshire Hathaway Energy’s 0.8-bcfd Cove Point LNG export plant in Maryland around September 19 for a few weeks of annual maintenance.
Around the world, gas traded near USD24 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe and USD26 at the Japan-Korea Marker (JKM) benchmark in Asia.
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