December Nymex natural gas (NGZ24) on Friday closed down by -0.024 (-0.89%)
Dec nat-gas prices posted moderate losses on Friday, weighed down by mild US autumn weather that will reduce heating demand for nat-gas. Forecaster Maxar Technologies said Friday that forecasts shifted warmer across parts of the central US for November 13-17 and that above-normal temperatures will persist in the eastern half of the country through November 22.
Lower-48 state dry gas production Friday was 100.6 bcf/day (-4.3% y/y), according to BNEF. Lower-48 state gas demand Friday was 77.2 bcf/day (-0.3% y/y), according to BNEF. LNG net flows to US LNG export terminals Friday were 13.4 bcf/day (+16.1% 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 Wednesday that total US (lower-48) electricity output in the week ended November 2 rose +1.24% y/y to 73,690 GWh (gigawatt hours), and US electricity output in the 52-week period ending November 2 rose +1.56% y/y to 4,161,739 GWh.
Thursday’s weekly EIA report was bearish for nat-gas prices since nat-gas inventories for the week ended November 1 rose +69 bcf, above expectations of +68 bcf and well above the 5-year average build for this time of year of +32 bcf. As of November 1, nat-gas inventories were up +4.2% y/y and were +5.8% above their 5-year seasonal average, signaling ample nat-gas supplies. In Europe, gas storage was 95% full as of November 3, above the 5-year seasonal average of 93% full for this time of year.
Baker Hughes reported Friday that the number of active US nat-gas drilling rigs in the week ending November 8 was unchanged at 102 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).
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