November Nymex natural gas (NGX24) on Thursday closed down by -0.020 (-0.84%).
Nov nat-gas prices on Thursday extended Wednesday's sharp decline to a new 1-month nearest-futures low. The outlook for above-normal US temperatures that will reduce heating demand for nat-gas is weighing on nat-gas prices. Forecaster Maxar Technologies said Thursday that forecasts have shifted warmer for the western half of the US from October 22-26. Losses in nat-gas prices were limited after weekly EIA nat-gas inventories rose +76 bcf, right on expectations but well below the five-year average for this time of year of +96 bcf.
Lower-48 state dry gas production Thursday was 102.3 bcf/day (-1.1% y/y), according to BNEF. Lower-48 state gas demand Thursday was 73.5 bcf/day (+1.7% y/y), according to BNEF. LNG net flows to US LNG export terminals Thursday were 13.9 bcf/day (+16.6% w/w), according to BNEF.
An increase in US electricity output is positive for nat-gas demand from utility providers. The Edison Electric Institute reported Thursday that total US electricity output in the week ended October 12 rose +6.76% y/y to 73,640 GWh (gigawatt hours), and US electricity output in the 52-week period ending October 12 rose +1.62% y/y to 4,158,968 GWh.
Thursday's weekly EIA report was neutral for nat-gas prices since nat-gas inventories for the week ended October 11 rose +76 bcf, right on expectations but below the 5-year average build for this time of year of +96 bcf. As of October 11, nat-gas inventories were up +2.2% y/y and were +4.6% above their 5-year seasonal average, signaling ample nat-gas supplies. In Europe, gas storage was 95% full as of October 13, above the 5-year seasonal average of 92% full for this time of year.
Baker Hughes reported last Friday that the number of active US nat-gas drilling rigs in the week ending October 11 fell by -1 rig to 101 rigs, modestly above the 3-1/3 year low from September 6 of 94 rigs. Active rigs have fallen since posting a 5-year high of 166 rigs in Sep 2022, up from the pandemic-era record low of 68 rigs posted in July 2020 (data since 1987).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
