for week ending May 1, 2002 | Release date: May 2, 2002 | Previous weeks
Spot and futures prices have
rebounded strongly through yesterday's (Wednesday, May 1) trading from their
3-day slide at the end of last week, as lingering cold temperatures in parts of
the Midwest and Northeast teamed with unseasonably warm temperatures in the
Southeast and Southwest to boost gas demand. At the Henry Hub, 3 days of double-digit price increases brought the
average spot price there to $3.79 per MMBtu. On the NYMEX futures market, the futures contract for May delivery at
the Henry Hub closed its tenure as the near-month contract on Friday, April 26
at $3.319 per MMBtu, a net increase of just $0.055 per MMBtu since becoming the
near-month contract on March 26. Taking
over as the near-month contract this past Monday (April 29), the June contract
gained nearly 20 cents on its first day as the near-month contract, and by
yesterday had risen to $3.735 per MMBtu. The spot price for West Texas Intermediate crude oil, which had held
above $27 per barrel since last Friday, declined by 74 cents yesterday, falling
to $26.58 per barrel, or $4.58 per MMBtu, as tensions in the Middle East
gradually ease.
Prices:
Spot prices have risen significantly in the first 3
days of this week, spurred in part by unseasonable weather-related demand and
influenced by rising futures prices. At
the Henry Hub, where cash prices fell a cumulative 21 cents per MMBtu in the
last two days of last week to enter the weekend at $3.32 per MMBtu, the spot price
has risen a cumulative 47 cents to $3.79 per MMBtu. Average prices in most regions have risen from $0.40 to $0.55 per
MMBtu since Monday, with the Rocky Mountains showing the largest average
increase at $0.81 per MMBtu. However,
on a Wednesday-to-Wednesday basis, prices at most Rockies locations are still
well below their levels of last Wednesday (April 24). The Cheyenne hub is down 72 cents to $1.46 per MMBtu, while Kern
River is 22 cents lower than a week ago, at $2.13. Conversely, most other regions have recorded weekly gains mostly
in the range of 10 to 30 cents per MMBtu. Spot gas for delivery to New York City climbed to $4.06 per MMBtu on
Wednesday, joining the majority of points for Northeast delivery above the $4
mark. In Florida, persistent
temperatures in the 90s caused Florida Gas Transmission to extend its Overage
Alert Day notice for a third day, sending prices up $0.65 per MMBtu to
$5.35. Meanwhile, Midwest prices were
somewhat more moderate, as the spot price at the Chicago citygate gained 26
cents from last Wednesday, to $3.81 per MMBtu.
On the NYMEX, futures prices
have also surged. The contract for June
delivery began trading as the near-month contract on Monday with a sharp gain
of $0.189 per MMBtu, then climbed another $0.234 on Tuesday, as hot
temperatures in the Southeast and Southwest boosted demand, fulfilling National
Weather Service short-term forecasts. The June contract settled that day at $3.795 per MMBtu, its highest
level in many months. The release
Wednesday of a smaller-than-average net storage injection estimate by AGA had
little impact in the market, although the June contract did decline by 6 cents
to $3.735 per MMBtu.
Spot Prices ($ per MMBtu) |
Thur. |
Fri. |
Mon. |
Tues. |
Wed. |
25-Apr |
26-Apr |
29-Apr |
30-Apr |
1-May |
|
Henry Hub |
3.47 |
3.32 |
3.44 |
3.65 |
3.79 |
New York |
3.81 |
3.66 |
3.79 |
3.95 |
4.06 |
Chicago |
3.49 |
3.33 |
3.48 |
3.67 |
3.81 |
Cal. Comp. Avg,* |
3.14 |
2.70 |
3.14 |
3.27 |
3.32 |
Futures ($/MMBtu) |
|
|
|
|
|
May delivery |
3.295 |
3.319 |
expired |
expired |
expired |
June delivery |
3.306 |
3.372 |
3.561 |
3.795 |
3.735 |
July delivery |
3.341 |
3.407 |
3.589 |
3.823 |
3.767 |
*Avg. of NGI's reported
avg. prices for: Malin, PG&E
citygate, |
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and Southern California
Border Avg. |
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Source: NGI's Daily Gas
Price Index (http://intelligencepress.com). |
Storage:
Net injections of working gas into storage were 38 Bcf
for the week ended April 26, according to American Gas Association (AGA)
estimates. The injection estimate for the East region of 9 Bcf was the second
smallest for this week in the 9-year history of AGA data and was 63 percent
lower than the previous 5-year (1997-2001) EIA-estimated average. The relatively low injections in the East
could in part reflect some continuing space-heating demand resulting from the
generally cooler-than-normal weather in many states in the region. (See Temperature Map) (See Deviation Map) According to the latest National Weather
Service (NWS) data, gas customer weighted heating degree-days (HDDs) ranged
from 35 to 45 percent greater than normal for the week in New England, the
Middle Atlantic, and much of the Midwest. Conversely, the West region's stock build of 13 Bcf was the largest for
this week, exceeding the average by 44 percent as generally mild temperatures
prevailed along the populous West Coast. According to NWS data, the Census Division composed of Washington,
Oregon, and California recorded HDDs that were 2 percent less than normal for
the week, while also having 20 percent less electric home air conditioning
customer weighted cooling degree-days. Overall, the total net injection of 38 Bcf was 17 percent less than the
5-year average of 46 Bcf. At an
EIA-estimated 1,675 Bcf, total stocks as of April 26 were nearly 39 percent
greater than the 5-year average. (See Storage Figure)
NOTE: AGA terminated its weekly survey of natural gas storage operators
effective with its report of storage operations for the week ended April 26,
released Wednesday, May 1, 2002. The
EIA will begin posting the results of its new weekly storage survey on
Thursday, May 9, 2002. A sample of
EIA's report can be seen at: Weekly Gas Storage
Test Page. The Natural Gas
Weekly Market Update report will convert to the new data series in next week's
issue.
All Volumes
in Bcf |
Current
Stocks (Fri,4/26) |
Estimated
Prior 5-Year (1997-2001) Average |
Percent
Difference from 5 Year Average |
Net Change
from Last Week |
One-Week
Prior Stocks (Fri, 4/19)* |
East Region |
808 |
615 |
31% |
9 |
799 |
West Region |
276 |
184 |
50% |
13 |
263 |
Producing
Region |
591 |
409 |
44% |
16 |
575 |
Total Lower
48 |
1,675 |
1,208 |
39% |
38 |
1,637 |
Note: Net
change data are estimates published by AGA on Wednesday of each week. |
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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. |
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*Revised
to incorporate EIA survey data for February 2002. |
Other Market Trends:
EIA Weekly Storage Data
Series: EIA released the report Methodology
for EIA Weekly Underground Natural Gas Storage Estimates on Wednesday, May 1, which
discusses the methods and procedures that will be used by EIA to prepare weekly
estimates of working gas in storage. The paper describes the new weekly survey
form (EIA-912) and survey processing procedures, the methodology for sample
selection and estimation, and procedures relating to revisions and data
security. General
information on the weekly storage survey, including weekly release time, a
sample of the presentation format, and EIA's policy on the use of automated
retrieval programs (or robots) against the EIA web site, is available at http://tonto.eia.doe.gov/oog/info/ngs/information.html. A second paper, comparing the AGA and EIA
surveys and methods, will be available through this web site on May 9, 2002.
Summary:
Spot
prices reversed a late-week downward trend from last week with strong gains of
35 to 70 cents per MMBtu since Monday at most market locations. Futures prices also moved up substantially,
as short-term weather forecasts have consistently called for warmer-than-normal
temperatures throughout the country east and south of a line from around the
bottom of California to the middle of Lake Superior.