NATURAL GAS: LNG DEMAND WITHIN THE ENERGY MARKET
EIA: NATURAL GAS STORAGE WEEKLY REPORT
•Our power demand for gas has not only been higher than last year, it has been higher than the five-year range.
•LNG exports continue at around 13 Bcf/d
•LNG Project approval was temporarily suspended in January 2024, but the hold was lifted. This means the projects are back on track, though most are delayed until 2026.
Prompt-month NYMEX natural gas was trading at $2.32/MMbtu in morning trading, up $0.05/MMbtu as of 11:00 a.m. ET.
- The EIA reported an injection of 40 Bcf into underground storage for the week ending September 6, 2024, vs. an estimated injection of 50 Bcf.
- Inventories are 3,387 Bcf, 198 Bcf or 6.2% more than the same period last year and 296 Bcf or 9.6% more than the 5-year average.
- The remnants of Francine are moving up the lower Mississippi Valley with the forward speed of the storm slowing is it runs into ridging building to the north. This broad ridging will bring us a warmer than normal pattern from the Rockies to the East Coast with the West Coast cooling below normal as a trough digs into that region. This broadly warmer pattern will continue next week, but we will be dealing with a storm moving into the Carolinas early next week that will soften Mid-Atlantic temperatures.
- Capacity in the Permian Basin will soon increase as the Matterhorn Express Pipeline, with a capacity of 2.5 Bcf/d, is expected to begin service this month, according to EnLink Midstream, one of the project’s stakeholders.
- A summer marked by strong power burns did not translate into a bullish storage inventory situation. Surplus gas from another record warm winter was more than a match for strong gas demand this summer. Storage will be a bearish factor for gas well into the fourth quarter
WEATHER & NATURAL GAS DEMAND
Despite cooler temperatures for much of August 2024, it remains the second hottest summer on record, behind only last year.
6-10 DAY AND 8-14 DAY OUTLOOK
This forecast suggests a relatively mild week for most of the country, with no extreme temperature events anticipated. The scattered showers may provide some relief in areas experiencing warmer conditions.
2024 HURRICANE TRACKS
The three hurricanes that made landfall in 2024, Beryl,Debby and Francine all had different effects on the market.
- Since Francine’s landfall, we have seen higher prices than We did after Beryl and Debby because Francine affects only natural gas supply, not demand..
- Beryl landed near Matagorda, TX, and affected large population centers like Houston, TX is disrupting drilling in the Gulf. So, this had an effect on the natural gas supply and demand
- Debby made landfall near Steinhatchee, FL. This hurricane affected natural gas demand as well, but did not have much effect on supply.
- Francine landed near the Henry Hub Gas Distribution Center on the Louisiana shoreline. This affected supply but had little effect on demand as it did not land near large population centers.
NYMEX NATURAL GAS CALENDAR STRIPS
PJM AD HUB HISTORICAL FORWARD POWER CURVES
NATURAL GAS PRODUCTION
