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Natural Gas Weekly Update

for week ending April 24, 2019   |  Release date:  April 25, 2019   |  Next release:  May 2, 2019   |   Previous weeks


JUMP TO: In The News | Overview | Prices/Supply/Demand | Storage

In the News:

Global LNG trade posts record growth again in 2018, led by the growth in spot and short-term trade

In 2018, global trade in liquefied natural gas (LNG) increased by 3.2 billion cubic feet per day (Bcf/d) to 41.3 Bcf/d, an 8% increase from 2017 and the third-largest annual increase on record, according to the recently released The LNG Industry GIIGNL Annual Report 2019 by the International Group of Liquefied Natural Gas Importers (GIIGNL). Global spot and short-term LNG trade increased by 2.9 Bcf/d, the largest annual increase on record. Spot and short-term trade accounted for 32% of the total global LNG trade in 2018, up from 27% in 2017, as more uncontracted LNG supply, particularly from Australia, Russia, and the United States became available on the spot market.

Global liquefaction capacity continued to expand in 2018, as eight new liquefaction trains with a combined nameplate capacity of 4.8 Bcf/d were placed in service. Australia commissioned two new liquefaction trains—Wheatstone Train 2 and Ichthys Train 1—and is on track to overtake Qatar as the largest LNG exporter once the remaining projects (Ichthys Train 2 and Prelude Floating LNG) are commissioned in 2019, and all trains ramp up to full production. The United States commissioned three new liquefaction trains—Cove Point, Sabine Pass Train 5, and Corpus Christi Train 1, which added a combined 1.9 Bcf/d of liquefaction capacity. Russia’s Yamal LNG commissioned Trains 2 and 3, and Train 3 came online six months ahead of schedule. In 2018, Cameroon became the newest LNG exporter after commissioning Kribi offshore liquefaction project, which uses a Floating LNG production barge called Hilli Episeyo, converted from a regular LNG vessel.

Asian countries continued to lead the growth in global LNG demand in 2018, with four countries—China, South Korea, India, and Pakistan—increasing LNG imports by a combined 3.5 Bcf/d. China, after becoming world’s second-largest LNG importer in 2017, continued to increase LNG imports in 2018 by 2 Bcf/d, the largest annual increase since the country began importing LNG in 2006. Strong growth in China’s natural gas consumption supported by government policies promoting coal-to-natural gas switching in the industrial, power, and residential/commercial sectors, led to China overtaking Japan as the world’s largest natural gas importer in 2018. In South Korea, extended maintenance of nuclear plants required higher generation from natural gas-fired power plants and higher LNG imports, which increased by 0.8 Bcf/d year on year.

Several countries decreased their LNG imports in 2018 because of changing market conditions within these countries. Increases in domestic natural gas production in Egypt and the United Arab Emirates led to a decline in LNG imports in these countries of 0.6 Bcf/d and 0.2 Bcf/d, respectively. In Japan, the restart of several nuclear power plants led to a decline in LNG imports, which are expected to continue decreasing as more nuclear reactors are brought back online over the next several years.

Overview:

(For the week ending Wednesday, April 24, 2019)

  • Natural gas spot price movements were mixed this report week (Wednesday, April 17 to Wednesday, April 24). Henry Hub spot prices fell from $2.56 per million British thermal units (MMBtu) last Wednesday to $2.50/MMBtu yesterday.
  • At the New York Mercantile Exchange (Nymex), the price of the May 2019 contract decreased 5¢, from $2.517/MMBtu last Wednesday to $2.462/MMBtu yesterday. The price of the 12-month strip averaging May 2019 through April 2020 futures contracts declined 6¢/MMBtu to $2.665/MMBtu.
  • Net injections to working gas totaled 92 Bcf for the week ending April 19. Working natural gas stocks are 1,339 Bcf, which is 4% more than the year-ago level and 22% lower than the five-year (2014–18) average for this week.
  • The natural gas plant liquids composite price at Mont Belvieu, Texas, fell by 3¢/MMBtu, averaging $6.12/MMBtu for the week ending April 24. The price of propane fell by 3%. The price of natural gasoline and ethane rose by 2% and 1%, respectively. The price of butane and isobutane remained flat week over week.
  • According to Baker Hughes, for the week ending Tuesday, April 16, the natural gas rig count decreased by 2 to 187. The number of oil-directed rigs fell by 8 to 825. The total rig count decreased by 10, and it now stands at 1,012.

more summary data

Prices/Supply/Demand:

Prices decline across much of the country. This report week (Wednesday, April 17 to Wednesday, April 24), Henry Hub spot prices fell 6¢ from $2.56/MMBtu last Wednesday to $2.50/MMBtu yesterday. At the Chicago Citygate, prices decreased 16¢ from $2.40/MMBtu last Wednesday to $2.24/MMBtu yesterday. Prices at PG&E Citygate in Northern California fell 27¢, down from $3.24/MMBtu last Wednesday to $2.97/MMBtu yesterday. Prices at SoCal Citygate decreased 46¢ from $2.90/MMBtu last Wednesday to $2.44/MMBtu yesterday as temperatures in Southern California cooled over the weekend.

Northeast prices drop at most locations. Northeast prices trended mostly down, in many cases seeing a significant drop from Wednesday to Thursday in anticipation of mild temperatures over the weekend (exchanges were closed on Friday). At the Transcontinental Pipeline Zone 6 trading point for New York City, prices decreased 7¢ from $2.35/MMBtu last Wednesday to $2.28/MMBtu yesterday, with a low of $2.07/MMBtu on Thursday. At the Algonquin Citygate, which serves Boston-area consumers, prices went up 3¢ from $2.40/MMBtu last Wednesday to $2.43/MMBtu yesterday, with a low of $2.21/MMBtu on Thursday.

Tennessee Zone 4 Marcellus spot prices decreased 18¢ from $2.10/MMBtu last Wednesday to $1.92/MMBtu yesterday, with a low of $1.31/MMBtu on Thursday. Prices at Dominion South in southwest Pennsylvania fell 10¢ from $2.23/MMBtu last Wednesday to $2.13/MMBtu yesterday.

Waha discount to Henry Hub shrinks. Prices at the Waha Hub in West Texas, which is located near Permian Basin production activities, averaged $0.47/MMBtu last Wednesday, $2.09/MMBtu lower than Henry Hub prices. Yesterday, prices at the Waha Hub averaged $0.86/MMBtu, $1.64/MMBtu lower than Henry Hub prices.

Maintenance affects Kingsgate prices. Prices at Kingsgate on the Idaho-Canada border fell from $1.61/MMBtu last Wednesday to $0.62/MMBtu yesterday. The price drop occurred after TransCanada announced a force majeure on its Gas Transmission Northwest Pipeline at the Flow Past Kingsgate location, just south of Kingsgate. The maintenance will reduce flow capacity there to 1.7 Bcf/d compared to an average flow of 2.3 Bcf/d in the first few weeks of April, before the restriction, according to data from PointLogic Energy.

Supply remains flat. According to data from PointLogic Energy, the average total supply of natural gas remained the same as in the previous report week, averaging 94.9 Bcf/d. Dry natural gas production remained constant week over week. Average net imports from Canada decreased by 4% from last week.

Demand falls as temperatures moderate. Total U.S. consumption of natural gas fell by 7% compared with the previous report week, according to data from PointLogic Energy. In the residential and commercial sectors, consumption declined by 21% as warmer temperatures reduced natural gas demand for space heating. Natural gas consumed for power generation declined by 1% week over week. Industrial sector consumption decreased by 1% week over week. Natural gas exports to Mexico decreased 11%. In addition, maintenance on the Corpus Christi pipeline, which delivers natural gas to Cheniere’s LNG export terminal, reduced feed gas flows to less than 0.1 Bcf/d as of Thursday. Previously in April, flows averaged 0.8 Bcf/d, according to data from PointLogic Energy.

U.S. liquefied natural gas (LNG) exports increase week over week.. Eight LNG vessels (six from Sabine Pass, one from Cove Point, and one from Corpus Christi) with a combined LNG-carrying capacity of 28.9 Bcf departed the United States from April 18 to April 24, according to shipping data compiled by Bloomberg.

Storage:

Net injections into storage totaled 92 Bcf for the week ending April 19, compared with the five-year (2014–18) average net injections of 47 Bcf and last year's net withdrawals of 20 Bcf during the same week. Working gas stocks totaled 1,339 Bcf, which is 369 Bcf lower than the five-year average and 55 Bcf more than last year at this time.

According to The Desk survey of natural gas analysts, estimates of the weekly net change from working natural gas stocks ranged from net injections of 83 Bcf to 102 Bcf, with a median estimate of 92 Bcf.

More storage data and analysis can be found on the Natural Gas Storage Dashboard and the Weekly Natural Gas Storage Report.

See also:



Natural gas spot prices
Spot Prices ($/MMBtu)
Thu,
18-Apr
Fri,
19-Apr
Mon,
22-Apr
Tue,
23-Apr
Wed,
24-Apr
Henry Hub 2.48 Closed 2.55 2.49 2.50
New York 2.07 Closed 2.22 2.31 2.28
Chicago 2.33 Closed 2.28 2.25 2.24
Cal. Comp. Avg.* 2.26 Closed 2.28 2.28 2.45
Futures ($/MMBtu)
May Contract 2.490 Closed 2.524 2.455 2.462
June Contract 2.535 Closed 2.558 2.499 2.500
*Avg. of NGI's reported prices for: Malin, PG&E Citygate, and Southern California Border Avg.
Sources: Natural Gas Intelligence and CME Group as compiled by Bloomberg, L.P.
Natural gas futures prices
Natural gas liquids spot prices


U.S. natural gas supply - Gas Week: (4/18/19 - 4/24/19)
Average daily values (Bcf/d):
this week
last week
last year
Marketed production
100.9
100.7
90.6
Dry production
90.0
89.8
80.0
Net Canada imports
4.9
5.1
5.6
LNG pipeline deliveries
0.1
0.1
0.1
Total supply
94.9
95.0
85.6

Source: OPIS PointLogic Energy, an IHS Company
Note: LNG pipeline deliveries represent natural gas sendout from LNG import terminals.

U.S. natural gas consumption - Gas Week: (4/18/19 - 4/24/19)
Average daily values (Bcf/d):
this week
last week
last year
U.S. consumption
58.0
62.6
68.2
    Power
21.8
22.1
23.1
    Industrial
20.4
20.7
21.3
    Residential/commercial
15.8
19.8
23.8
Mexico exports
4.0
4.5
4.3
Pipeline fuel use/losses
5.9
6.0
5.7
LNG pipeline receipts
5.1
4.8
3.5
Total demand
73.0
77.9
81.7

Source: OPIS PointLogic Energy, an IHS Company
Note: LNG pipeline receipts represent pipeline deliveries to LNG export terminals.

Natural gas supply


Weekly natural gas rig count and average Henry Hub
Rigs
Tue, April 16, 2019
Change from
 
last week
last year
Oil rigs
825
-1.0%
0.6%
Natural gas rigs
187
-1.1%
-2.6%
Note: Excludes any miscellaneous rigs
Rig numbers by type
Tue, April 16, 2019
Change from
 
last week
last year
Vertical
51
-7.3%
-5.6%
Horizontal
886
-0.3%
-0.3%
Directional
75
-3.8%
7.1%
Source: Baker Hughes Inc.


Working gas in underground storage
Stocks
billion cubic feet (Bcf)
Region
2019-04-19
2019-04-12
change
East
251
228
23
Midwest
264
254
10
Mountain
 70
 66
4
Pacific
138
128
10
South Central
616
571
45
Total
1,339
1,247
92
Source: Form EIA-912, Weekly Underground Natural Gas Storage Report
Working gas in underground storage
Historical comparisons
Year ago
(4/19/18)
5-year average
(2014-2018)
Region
Stocks (Bcf)
% change
Stocks (Bcf)
% change
East
205
22.4
277
-9.4
Midwest
213
23.9
338
-21.9
Mountain
84
-16.7
117
-40.2
Pacific
177
-22.0
216
-36.1
South Central
604
2.0
761
-19.1
Total
1,284
4.3
1,708
-21.6
Source: Form EIA-912, Weekly Underground Natural Gas Storage Report


Temperature – heating & cooling degree days (week ending Apr 18)
 
HDD deviation from:
 
CDD deviation from:
Region
HDD Current
normal
last year
CDD Current
normal
last year
New England
93
-42
-71
0
0
0
Middle Atlantic
69
-47
-62
0
0
0
E N Central
110
-10
-53
0
0
0
W N Central
128
18
-49
1
0
1
South Atlantic
26
-31
-36
29
14
13
E S Central
35
-17
-33
7
2
7
W S Central
32
8
-7
18
-2
4
Mountain
113
0
-9
4
-4
1
Pacific
57
-9
-32
0
-3
0
United States
76
-14
-41
8
2
3
Note: HDD = heating degree day; CDD = cooling degree day

Source: National Oceanic and Atmospheric Administration

Average temperature (°F)

7-day mean ending Apr 18, 2019

Mean Temperature (F) 7-Day Mean ending Apr 18, 2019

Source: National Oceanic and Atmospheric Administration

Deviation between average and normal (°F)

7-day mean ending Apr 18, 2019

Mean Temperature Anomaly (F) 7-Day Mean ending Apr 18, 2019

Source: National Oceanic and Atmospheric Administration