Monday, November 2, 2015

Natural Gas: EIA Weekly Supply/Demand Report

From the Energy Information Administration:
...Nymex prices are down. The Nymex near-month futures price (November 2015) fell by 37¢ over the report period, from $2.404/MMBtu last Wednesday to $2.033 yesterday. The price fell by 22¢ (10%) on Monday alone. The current price level is noteworthy because it is the lowest that any near-month futures price has been since late April 2012, which is remembered as the summer of remarkably low natural gas prices.

In addition to relatively high storage levels and year-over-year production growth entering this winter, the anticipation that El Nino will moderate the upcoming winter temperatures may be contributing to the lower prices. The winter strip, which averages the November through March Nymex contracts, settled yesterday at $2.349/MMBtu. This is very low compared to previous years. Last year's winter strip price on October 28, for example, was $3.750.

The November futures contract settled on Wednesday, and December is now the prompt-month contract. On Wednesday, the December contract closed at $2.298/MMBtu, significantly higher than the November contract at expiration.

Supply decreases slightly. Total supply fell again this week, decreasing by 0.5% according to data from Bentek Energy. Although dry production was down by 0.2%, or about 0.2 Bcf/d, this week's supply decrease was driven by a decline in Midwest imports from Canada, which reduced supply by 0.4 Bcf/d. This was only partially offset by increased imports into the Northeast and West. LNG sendout this week was very close to flat.

Consumption decreases slightly. Week-over-week total consumption fell by 0.4%. Residential/commercial consumption drove the decrease, falling 2.2%, or 0.4 Bcf/d. The power sector had increased consumption, rising by 1.1%, or 0.3 Bcf/d, led by increased power burn in Texas and the Southeast. Exports to Mexico were down, and industrial consumption was essentially flat....MUCH MORE
...Temperatures during the storage report week are close to normal. Temperatures in the Lower 48 states averaged 57° for the storage report week, 1° warmer than the 30-year normal temperature and 1° cooler than the average temperature during the same week last year. There were 68 population-weighted heating degree days (HDD) during this report week, 9 HDD more than the five-year average and 8 HDD more than during the same period last year. There were also 10 population-weighted cooling degree days (CDD) this report week, 2 CDD more than the five-year average and 3 CDD more than this week last year.
Mean Temperature Anomaly (F) 7-Day Mean ending Oct 22, 2015