for week ending June 24, 2001 | Release date: June 25, 2001 | Previous weeks
The industry stock build that began in April has continued into June as the latest weekly estimate indicates that more than 100 Bcf was again added to working gas storage levels. At the same time that natural gas stocks have been increasing, prices have been generally trending down. Prices at many major spot markets moved down most days last week and ended the week between 20 and 30 cents per MMBtu below Tuesday's prices. On the NYMEX futures market, the near-month (July) contract also ended the week down 25 cents from Tuesday's high of $3.981. Much of the country continued to enjoy moderate temperatures during last week, which saw the first day of summer(June 21) prices (See Temperature Map) (See Deviation from Normal Temperatures Map).
Prices:
A softening of demand
attributable to last week's relatively moderate temperatures and a forecast for
a continuation of this weather pattern have contributed to lower prices at most
markets. After remaining generally unchanged at the beginning of the week,
prices moved up 5 to 10 cents on Tuesday before declining steadily following
the release of the stock build estimate on Wednesday.Some of the lowest prices last week in the industry press were in
the Rocky Mountains at the Opal Hub in Wyoming, which dropped 80 cents ($3.00
to $2.20). In California, a high-linepack operational flow order on the SoCal
system saw prices drop to $3.88 per MMBtu. from Thursday's price of $6.54.
Prices at the Canadian border also trended down last week. At the Sumas border
crossing into Washington State the price moved down $0.58 to $3.17 per MMBtu,
and at the Iroquois crossing point in New York it declined $0.30 to $3.88 per
MMBtu.
At the NYMEX, the near-month July
contract for delivery at the Henry Hub trended down most days to end the week
at $3.742. The futures contracts covering the remaining months of the storage
refill season all ended trading on Friday well below $4.00 with August at
$3.802, September at $3.845, and October at $3.898. The July contract will
close on Wednesday June 27, and barring any unforeseen events, it will end
trading below last year's final July contract price of $4.369.
Spot Prices ($ per MMBTU)-Selected
Trading Centers |
Mon. 6/18 |
Tues. 6/19 |
Wed. 6/20 |
Thur. 6/21 |
Fri.6/22 |
---|---|---|---|---|---|
Henry Hub |
3.90 |
3.94 |
3.82 |
3.69 |
3.69 |
New York citygates |
4.41 |
4.52 |
4.25 |
4.10 |
4.07 |
Chicago citygates |
3.88 |
3.95 |
3.81 |
3.69 |
3.68 |
Northern CA PG&E |
4.32 |
4.07 |
4.13 |
4.48 |
3.76 |
Southern CA (SOCAL) |
8.25 |
7.34 |
6.89 |
6.54 |
3.88 |
Futures (Daily
Settlement, $MMBTU) |
|
|
|
|
|
July Delivery |
3.939 |
3.981 |
3.734 |
3.747 |
3.742 |
August Delivery |
4.024 |
4.060 |
3.809 |
3.810 |
3.802 |
Source: Financial Time
Energy, Gas Daily |
Storage:
Once
again, storage injections set a record as the American Gas Association (AGA) reported
that an estimated 106 Bcf was added to U.S. working gas inventories during the
week ended Friday, June 15.Records
were set in 7 of the 12 weeks of this refill season and near records in 2 other
weeks.With these injections,
EIA-estimated stock levels are above the 6-year (1995-2000) average for the
first time since March 2000 in the United States as a whole and the Producing
region—and, for the first time since December 1999, in the East region (See Storage Figure).Only the West region continues to fall below the 6-year average, but by
less than 3 percent.Injections of 30
Bcf in the Producing region were also a new record for this week in the refill
season, while the 14 Bcf injected into West region facilities was the second
highest for this week.
All Volumes
in BCF |
Current
Stocks (Fri,6/15) |
Estimated
6-Year (1995-2000) Average |
Percent
Difference from 6 Year Average |
Net Change
from Last Week |
One-Week
Prior Stocks (Fri,6/8) |
|
---|---|---|---|---|---|---|
East Region |
945 |
939 |
0.6% |
62 |
883 |
|
West Region |
258 |
265 |
-2.5% |
14 |
244 |
|
Producing Region |
519 |
504 |
2.9% |
30 |
489 |
|
Total Lower 48 |
1,722 |
1,708 |
0.8% |
106 |
1,616 |
|
Note:net change data are estimates published by
AGA on Wednesday of each week.All
stock-level Figures are EIA estimates based on EIA monthly survey data and
weekly AGA net-change estimates.Column sums may differ from Totals because of independent
rounding. |
||||||
Other Market Trends:
The latest Bureau of Labor
Statistics's (BLS) consumer price index (CPI) for May 2001 reports that the
seasonally adjusted price of natural gas delivered to residential users
declined by 2 percent nationally between April and May. This was the fourth
consecutive month of decline in the CPI for residential natural gas
consumers.Compared with last year,
natural gas prices were 43 percent higher than in May 2000.
Summary:
The robust stock rebuild continued into the second week
of June and spot prices trended down last week to well below $4.00 at several
major market locations.The NYMEX
near-month contract also moved down most days last week. The BLS reported that
for the fourth consecutive month, the price of natural gas to residential
consumers declined in May.