Natural Gas

Market Highlights:

Prices

• Henry Hub spot price: The Henry Hub spot price rose 34 cents from $6.46 per million British thermal units (MMBtu) last Wednesday to $6.80/MMBtu yesterday.
• Henry Hub futures prices: The December 2022 NYMEX contract expired Monday at $6.712/MMBtu, down 60 cents from last Wednesday. The January 2023 NYMEX contract price decreased to $6.930/MMBtu, down 78 cents from last Wednesday to yesterday. The price of the 12-month strip averaging January 2023 through December 2023 futures contracts declined 15 cents to $5.709/MMBtu.
• Select regional spot prices: Natural gas spot prices rose at most locations this report week (Wednesday, November 23, to Wednesday, November 30). Week-over-week price changes at major pricing hubs ranged from an increase of $8.72 at SoCal Citygate in Southern California to a decrease of $0.38 at Cheyenne Hub in the Rocky Mountain region.
• Prices across much of the West rose significantly this week. Prices at Opal in Southwest Wyoming, the main trading point for natural gas in the Rocky Mountain region and the origin point for deliveries into the California market through the Ruby Pipeline, rose $6.06 from $10.00/MMBtu last Wednesday to $16.06/MMBtu yesterday. At Northwest Sumas, located in Washington on the border with Canada and the primary natural gas trading hub for consumers in the Pacific Northwest (Washington, Oregon, and Idaho), the price rose $4.61 from $11.85/MMBtu last Wednesday to $16.46/MMBtu yesterday. Prices at the Malin hub on the Oregon/California border, the main northern delivery point into the PG&E service territory, rose $5.10 from $12.00/MMBtu last Wednesday to $17.10/MMBtu yesterday, its highest daily price since February 2019. Several factors contributed to the rapid price increases this report week, including colder temperatures in western Canada that led to a 0.2 billion cubic feet per day (Bcf/d) decrease in exports to the Western region this report week, according to data from PointLogic. At the Westcoast Station 2 pricing point in central British Columbia, Canada, the main aggregation point for natural gas produced in northeast British Columbia and western Alberta before these volumes are shipped south along the Enbridge Westcoast Energy pipeline, prices rose $4.96/MMBtu, from $1.58/MMBtu last Wednesday to $6.54/MMBtu yesterday. Overall natural gas consumption in the residential and commercial sectors combined increased by 2% (0.1 Bcf/d) week over week in the Western region. In the Seattle City Area, temperatures averaged 40°F this report week, leading to 175 heating degree days (HDD), 29 more HDDs than last week. Last Thursday, daily temperatures in the Seattle City Area averaged 43°F. They fell to a daily average of 35°F on Monday, while yesterday they averaged 37°F.
• In California, the price at PG&E Citygate in Northern California rose $4.55, up from $12.25/MMBtu last Wednesday to $16.80/MMBtu yesterday. The price at SoCal Citygate in Southern California increased $8.72 from $10.57/MMBtu last Wednesday to $19.29/MMBtu yesterday. California prices rose as a result of higher prices across the West, and they have also been affected by pipeline constraints on westbound flows from the Permian Basin. El Paso Natural Gas Company planned electrical unit maintenance at the Waha station Monday through Friday of this week, reducing westbound flows by up to 138 million cubic feet per day.
• In the Northeast, prices rose this report week. At the Algonquin Citygate, which serves Boston-area consumers, the price rose $3.11 from $6.80/MMBtu last Wednesday to $9.91/MMBtu yesterday. At the Transcontinental Pipeline Zone 6 trading point for New York City, the price increased 63 cents from $6.10/MMBtu last Wednesday to $6.73/MMBtu yesterday. Prices in the Northeast have fluctuated in recent weeks, with the price at Algonquin Citygate falling to a monthly low of $0.74/MMBtu on November 4 and rising as high as $11.60/MMBtu on November 18. Daily natural gas consumption has fluctuated across the week with temperatures. In the Boston Area, temperatures rose from the start of the report week to a daily average of 50°F on Sunday. Temperatures subsequently fell to a daily average of 38°F on Tuesday, before rising to a daily average of 49°F yesterday. The price at Algonquin Citygate set a weekly low of $5.86/MMBtu on Monday.

Daily spot prices by region are available on the EIA website.

• International futures prices: International natural gas futures prices increased this report week. According to Bloomberg Finance, L.P., weekly average futures prices for liquefied natural gas (LNG) cargoes in East Asia increased $2.95 to a weekly average of $31.01/MMBtu, and natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, the most liquid natural gas market in Europe, increased $4.07 to a weekly average of $40.01/MMBtu.
• Natural gas plant liquids (NGPL) prices: The natural gas plant liquids composite price at Mont Belvieu, Texas, fell by 36 cents/MMBtu, averaging $8.30/MMBtu for the week ending November 30. Ethane fell 2%, while natural gas prices at the Houston Ship Channel rose 3%, narrowing the ethane premium to natural gas by 33%. Ethylene spot prices fell 1%, widening the ethylene to ethane premium by 3%. Propane prices fell 7%, while the weekly average price of Brent crude oil fell 3%, resulting in a 2% increase in the propane discount relative to crude oil. Normal butane, isobutane, and natural gasoline prices followed crude oil prices, with both butanes falling by 4% and natural gasoline falling by 3%.

Supply and Demand

• Supply: According to data from PointLogic, the average total supply of natural gas fell by 0.6% (0.7 Bcf/d) compared with the previous week. Dry natural gas production grew by 0.5% (0.5 Bcf/d), and average net imports from Canada decreased by 18.4% (1.2 Bcf/d) from last week.
• Demand: Total U.S. consumption of natural gas fell by 16.5% (16.6 Bcf/d) compared with the previous week, according to data from PointLogic. Natural gas consumed for power generation declined by 14.4% (4.7 Bcf/d) week over week. Industrial sector consumption decreased by 5.1% (1.3 Bcf/d) week over week, and residential and commercial sector consumption declined by 25.1% (10.6 Bcf/d) as warmer-than-normal weather stretched from the Midwest to the east coast. Natural gas exports to Mexico increased 5.8% (0.3 Bcf/d). Natural gas deliveries to U.S. LNG export facilities (LNG pipeline receipts) averaged 11.6 Bcf/d, or 0.5 Bcf/d lower than last week.

Liquefied Natural Gas (LNG)

• Pipeline receipts: Overall natural gas deliveries to U.S. LNG export terminals decreased by 0.5 Bcf/d week over week to average 11.6 Bcf/d this report week, according to data from PointLogic. Natural gas deliveries to LNG export terminals in South Louisiana fell by 0.1 Bcf/d to 8.5 Bcf/d, while deliveries to LNG export terminals in South Texas fell by 0.4 Bcf/d.
• Vessels departing U.S. ports: Sixteen LNG vessels (seven from Sabine Pass, three each from Cameron and Corpus Christi, two from Calcasieu Pass, and one from Elba Island) with a combined LNG-carrying capacity of 59 Bcf departed the United States between November 24 and November 30, according to shipping data provided by Bloomberg Finance, L.P.

Rig Count

• According to Baker Hughes, for the week ending Tuesday, November 23, the natural gas rig count decreased by 2 rigs from a week ago to 155 rigs. The Haynesville and an unidentified producing region each dropped one rig. The number of oil-directed rigs increased by 4 rigs from a week ago to 627 rigs. The Permian added three rigs, the Cana Woodford added one rig, and two rigs were added in unidentified producing regions. The Arkoma Woodford and the Barnett each dropped one rig. The total rig count, which includes 2 miscellaneous rigs, now stands at 784 rigs, the highest level since March 13, 2020, and 215 more rigs than the same week last year.

Storage

• The net withdrawals from storage totaled 81 Bcf for the week ending November 25, compared with the five-year (2017–2021) average net withdrawals of 34 Bcf and last year's net withdrawals of 54 Bcf during the same week. Working natural gas stocks totaled 3,483 Bcf, which is 86 Bcf (2%) lower than the five-year average and 89 Bcf (2%) lower than last year at this time.
• According to The Desk survey of natural gas analysts, estimates of the weekly net change to working natural gas stocks ranged from net withdrawals of 76 Bcf to 121 Bcf, with a median estimate of 86 Bcf.

See also:

• Natural Gas Analysis Reports
• Short-Term Energy Outlook