• Sign up for the Daily Digest E-mail
  • Facebook
  • Twitter
  • LinkedIn

BOE Report

Sign up
  • Home
  • Headlines
    • Latest Headlines
    • Featured Companies
    • Columns
    • Discussions
  • Well Activity
    • Well Licences
    • Well Activity Map
  • Property Listings
  • Land Sales
  • M&A Activity
    • M&A Database
    • AER Transfers
  • Markets
  • Rig Counts
    • CAOEC Rig Count
    • Baker Hughes Rig Count
    • USA Rig Count
  • Industry Data
    • Canada Oil Market Data
    • Canada NG Market Data
    • USA Market Data
    • Data Downloads
  • Jobs

U.S. natgas futures slide 3% on mild weather outlook

March 15, 20225:20 AM Reuters0 Comments

natural gas stove

U.S. natural gas futures slid about 3% on Tuesday on forecasts for milder than normal weather and lower heating demand over the next two weeks than previously expected, which should allow utilities to start injecting gas into storage next week – about a week earlier than usual.

That price decline came even though European gas prices shot up about 8% so far on Tuesday after Eastern Europe started pulling gas from the West.

European gas was trading about eight times over U.S. futures, keeping demand for U.S. liquefied natural gas (LNG) exports at record highs – especially since Russia’s invasion of Ukraine on Feb. 24 stoked global energy supply concerns. Russia is the world’s second-biggest gas producer after the United States.

But U.S. gas futures remain shielded from global prices because the United States has all the fuel it needs for domestic use and the country’s ability to export more LNG is limited by capacity constraints.

The United States is already producing LNG near full capacity. So, no matter how high global gas prices rise, it will not be able to produce much more of the supercooled fuel anytime soon.

Before Russia’s invasion, the United States worked with other countries to ensure gas supplies, mostly from LNG, would keep flowing to Europe. Russia usually provides around 30% to 40% of Europe’s gas, which totaled about 18.0 billion cubic feet per day (bcfd) in 2021.

U.S. front-month gas futures fell 12.5 cents, or 2.7%, to $4.533 per million British thermal units at 9:04 a.m. EDT (1304 GMT).

The premium of futures for May over April rose to a record high of 5.1 cents.

Data provider Refinitiv said average gas output in the U.S. Lower 48 states was on track to rise to 93.0 bcfd in March from 92.5 bcfd in February as more oil and gas wells return to service after freezing earlier in the year. That compares with a monthly record of 96.2 bcfd in December.

With milder spring weather coming, Refinitiv projected average U.S. gas demand, including exports, would drop from 109.8 bcfd this week to 94.4 bcfd next week. Those forecasts were lower than Refinitiv’s outlook on Monday.

The amount of gas flowing to U.S. LNG export plants rose to 12.70 bcfd so far in March from 12.43 bcfd in February and a record 12.44 bcfd in January. The United States has the capacity to turn about 12.7 bcfd of gas into LNG.

Traders said U.S. LNG exports would remain near record levels so long as global gas prices trade well above U.S. futures as utilities around the world scramble for cargoes to meet surging demand in Asia and replenish low inventories in Europe, especially with the threat Russia could cut European supplies.

Gas futures traded near $39 per mmBtu in Europe and $37 in Asia, compared with around $5 in the United States.

Global markets will have to wait until later this year when more of the 18 liquefaction trains under construction at Venture Global LNG’s Calcasieu Pass export plant in Louisiana start producing LNG.

LNG

Follow the BOE Report
  • Facebook
  • Twitter
  • LinkedIn

Sign up for the BOE Report Daily Digest E-mail

Successfully subscribed

Latest Headlines
  • TC Energy to build $5 bln gas pipeline in Mexico, official says
  • U.S. natgas jumps 6% after big loss on hot weather, technical bounce
  • U.S. LNG exports fall to lowest since Feb after Freeport explosion -data
  • U.S. oil & gas rig count falls for first time in five weeks – Baker Hughes
  • InPlay Oil Corp. Announces Extension of Senior Credit Facility

Return to Home
Alberta Gas
CAD/GJ
Market Data by TradingView

    Report Error





    Note: The page you are currently on will be sent with your report. If this report is about a different page, please specify.

    About
    • About BOEReport.com
    • In the News
    • Terms of Use
    • Privacy Policy
    • Editorial Policy
    Resources
    • App
    • Widgets
    • Notifications
    • Daily Digest E-mail
    Get In Touch
    • Advertise
    • Post a Job
    • Contribute
    • Contact
    • Report Error
    Featured In
    • CamTrader
    • Rigger Talk
    Data Partner
    • Foxterra
    BOE Network
    © 2022 Grobes Media Inc.