EIA: NAtural Gas Supply Update
Natural gas supply experienced a slight dip this week, falling to 101.4 Bcf/d. Despite this minor setback, the market has shown resilience in recent weeks. The cooler temperatures in the latter half of August contributed to stronger injections, with five out of the last seven injections approaching the five-year average.
Injection Report: Last week’s report showed a +13 Bcf injection, which was weaker than both last year’s figures and the five-year average. This fell short of projected forecasts.
Future Pricing: We’re observing a gradual descent in future year pricing. Notably, we don’t anticipate seeing a monthly price above $4.00 until January 2026.
LNG Demand
The demand landscape for natural gas remains robust:
- Power demand for gas has surpassed last year’s levels and the five-year range.
- LNG exports continue to hold steady at approximately 13 Bcf/d.
LNG Project Update: LNG project approvals faced a temporary suspension in January 2024, but this hold has since been lifted. Projects are back on track, though most have been delayed until 2026.
Weather and Demand Forecast
The weather continues to play a crucial role in shaping demand:
- Eastern US: Cooler than average temperatures have reduced power demand, a trend expected to persist for the next few days.
- Western US: A warm front is anticipated to move eastward, bringing higher temperatures. However, the West can expect cooler temperatures to follow.
Detailed Forecast (September 9-15)
Early Week:
- Eastern US: Weather systems will bring cooler temperatures, with highs in the upper 60s to 80s.
- Western US: Hot conditions prevail, with highs from mid-80s to 100s. The West Coast will enjoy milder weather, with temperatures in the 70s.
Late Week:
- Northern US: Comfortable temperatures with highs in the 60s to 80s.
- Southern US: Hot conditions continue, with highs from mid-80s to 100s.
- Texas/Louisiana: Prepare for heavy tropical rains.
Market Outlook
The energy market appears balanced for the coming week, with moderate national energy demand expected. The cooler temperatures in some regions and continued warmth in others suggests no significant disruptions to natural gas supply or demand.
NYMEX NATURAL GAS CALENDAR STRIPS
ALL ABOUT THE NYMEX TWELVE-MONTH STRIP
- The NYMEX Twelve Month Strip is the average of the upcoming 12 months of closing Henry Hub natural gas futures prices as reported on CME/NYMEX.
- A futures strip is the buying or selling of futures contracts in sequential delivery months traded as a single transaction.
- The NYMEX Twelve Month Strip can lock in a specific price for natural gas futures for a year with 12 monthly contracts connected into a strip.
- The average price of these 12 contracts is the particular price that traders can transact at, indicating the direction of natural gas prices.
- The price of the NYMEX Twelve Month Strip can show the average cost of the next twelve months’ worth of futures.
- • The NYMEX Twelve Month Strip is also used to understand the direction of natural gas prices and to lock in a specific price for natural gas futures for a year.
PJM AD HUB FORWARD POWER
NATURAL GAS PRODUCTION
FUTURE LNG PROJECTS
