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Natural gas futures rallied all week towards  the cycle high at $6.466 intraweek high after holding $5.393 on supply shortage fears remaining. U.S. LNG exports of LNG continue to grow. EIA reported a larger build of +81Bcf of working gas in storage.


us natgasl locations

 

 

EIA's Weekly Gas Storage Report. Report Date: 10/7/2021

  • Via TradersCommunity.com
  • Release Time: Thursday 10/14/2021 10:30 a.m. ET

Market Expectations

  • Actual  +81 Bcf Prior +118 Bcf
  • Consensus Forecast +90 Bcf
  • Cons. Range: +82 to +101 Bcf
  • Last Year: +36 Bcf
  • 5 Year Average: +53 Bcf 

 

Last Week's Report +118 Bcf #TCNG

Broken down by region

  • South Central region 41 Bcf increase 21 Bcf in nonsalt facilities and 20 Bcf in salts
  • Midwest 37 Bcf increase
  • East 31 Bcf increase
  • Mountain 5 Bcf increase
  • Pacific 5 Bcf increase

Natural gas Salt South Central 10 7 21

Current Storage Level vs. Last Year; 5-Yr

  • Current Storage Level: 3,288 Bcf
  • Storage 2020/Same Week:  3,820 Bcf Bcf
  • 5Yr Avg/Same Week: 3,464 Bcf

Global Impact

The energy crisis pounding the world with unheard of prices is impacting the domestic pricing, at least speculation of US natural gas. U.S. fundamentals only have the domestic gas market in bear territory with mild weather and low demand. All eyes seem to be overseas as the market with the storage trajectory in the final weeks of the injection season.

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Via Ole S Hansen @Ole_S_Hansen

Weather models show below-normal temperatures in southeastern Europe and warmer-than-normal readings for West and Northeast Europe. Maxar’s Weather Desk on ensemble models says “in generally good alignment, yielding average overall forecast confidence.” The counter is the Canadian Ensemble proposes warmer temperatures than forecast in places like Germany and France, according to the Weather Desk. “A negative phase of the Scandinavia pattern may play a role on the pattern here, and this offers the risk for cooler temperatures in the North.” NatGasWeather said if forecasts turn chillier for late October or early November over the next seven to 10 days, “a renewed push higher for the front month is likely.”

Domestic Weather

AccuWeather expects first snow in the Rockies in coming days. By Monday and Tuesday, a dip in the jet stream will become very pronounced across the Southwest. Much colder air combined with a stalling storm may lead to significant snowfall in parts of the West. “A storm will blossom and produce windy conditions with snow across most of the northern Rockies,” according to AccuWeather meteorologist Rob Richards.

Hurricane Season

The National Hurricane Center said over the next few months as the 2021 Atlantic hurricane season reaches its peak. The National Oceanic and Atmospheric Administration raised the number of named storms forecast to 15-21 named storms, including seven to 10 hurricanes and three to five major hurricanes, up from its May prediction for 13-20 named storms and six to 10 hurricanes, though its prediction of major hurricanes was unchanged.

With storms we watch Gulf of Mexico production and the impact on demand with the increasingly tight U.S. gas market. In 2020 back-to-back hurricanes in Louisiana knocked offline the Cameron LNG facility, as well as thousands of other Gulf Coast electricity customers for about a month.

Renewable generation coming in well below normal

Wind capacity is up more than 15 GW versus 2020, wind utilization has been below normal over the last two months, with July wind utilization realizing around 5% below normal and setting a new five-year minimum for the month. - Reic Fell of Wood McKenzie.  However, it is unlikely that wind utilization would remain that far below normal over the balance of the summer. Hydro output has averaged close to 7 average GW hours below the five-year average so far this summer, according to Fell. This is being driven by a severe western drought, which has added nearly 1 Bcf/d in gas burn relative to the five-year average.

Rigs

Baker Hughes active rigs total in the U.S. onshore and Gulf of Mexico (GOM)

  • Oil up 5 to 433 vs 193 year ago
  • NG UNCH 99 vs 73 (stalled mid summer +1 Marcellus -1 Utica)

Rig Watch changes by key shale basins

  • Permian +3 to 265
  • Eagle Ford +1 to 36
  • Williston unchanged at 23
  • Cana Woodford unchanged at 20
  • DJ Niobrara unchanged at 12

Comments by executives of multi-basin super independent EOG Resources Inc. mirrored those for many Lower 48 management teams.

“We’re not going to grow until the market clearly needs the barrels,” EOG President Ezra Yacob told analysts during a call Thursday. “We’re committed to staying disciplined. Currently, we want to see demand return to pre-Covid levels.”

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TradersCommunity Natural Gas Outlook Format

  1. EIA Natural Gas Storage Forecast and Analysis
  2. LNG and Export Warch
  3. Natural Gas Import Watch
  4. Natural Gas Demand Watch
  5. Nuke Watch
  6. Natural Gas Futures Technical Analysis
  7. Option Vol
  8. DCOT Report

Natural Gas Market Influence Factors:

Bearish factors include

  • Economic damage and reduced natural gas demand caused by the Covid pandemic,
  • Warm U.S. winter that resulted in weak demand for natural gas for heating.
  • Over long spec positions

Bullish factors include

  • Record foreign demand for U.S. nat-gas as flows to U.S LNG export terminals on April 18 rose to a record 11.921 bcf (data from 2014) and after U.S. LNG exporters loaded a record 81 cargoes in November, breaking the previous record of 75 set January of 2020,
  • Expectations that the low level of oil prices will reduce shale drilling and natural gas extraction as a by-product
  • Tighter U.S. nat-gas supplies that are down -14.8% y/y and -2.6% below their 5-year average.
  • High power burns
  • Perception that gas supply and demand are more inelastic than ever before.
  • Over short spec positions

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Weather Watch

Gulf of Mexico

Near Record Warm Gulf of Mexico Water temperatures are running 1-3+ degrees above average

Paths of Recent Gulf Hurricanes

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Natural Gas Quick Look

 

via Ole S Hansen @Ole_S_Hansen

EIA Natural Gas Storage Watch


EIA Storage Report

US Natural Gas Weekly Storage Forecasts

Surveys

  • Bloomberg Survey +105
  • DJ Survey +
  • Reuters Survey +115
  • Platts Survey+

Banks and Brokers

  • Macquarie+
  • Cti +
  • TFS +

Analysts

  • AgWxMan +
  • Refinitiv +
  • Bart Roy +119
  • Genscape +
  • Gabe Harris -
  • WoodMac +
  • Kidduff Report +
  • Platts GW +
  • Robry825 +
  • The Pit Boss +104
  • Norse +
  • Andrea Paltry +
  • Point Logic +
  • Bespoke +
  • Shane Boling +
  • Schneider Electric +
  • Donnie Sharp Huntsville +
  • NG Junkie -
  • EBW +

NB: Forecasts uploaded when provided to TradersCommunity.com - some weeks they may not made available.

 

EIA Swap Market - Brynne Kelly ‏@BrynneKKelly

 

Henry Hub Natural Gas Futures Weekly Chart Outlook via @KnovaWave

US Natural Gas (Henry Hub)

US Natural Gas (Henry Hub)

4 Hour::  Natural gas spitting to +8/8 than +1/8 240 before retreating in 3 waves to spit violently the 50 4hr ma stayed above the cloud until the completive 5 and back in the channel in a continuation pattern since regaining the 240 cloud to rebalance the Chikou to close the week. Continue to watch Kijun reactions and Murrey Math confluence.

NG 240 10 8 2021
 

Daily: US Natural Gas spat the daily 8/8 in a classic euphoria wave 5 to comeback to test Kijun and bounce between it and tenkan the power came from a  corrective ABC pennant of a (IV).  Notice the fractals of the move after completing the C of 4 bullish scenario has played out the consolidation phase since it completed its IV ( Bull Case) last year since then a series of 3 waves. Should the highs be a (iii) looking at possibilities we have the 161.8% at 7.026 if we get 'silly' 50dma support.

Like the larger wave on the way up it accelerated through previous highs (flat topped triangle energy) and over the resistance at 8/8 and new highs. We successfully tested that break in a pennant ABC. Previous highs (flat topped triangle energy) and 8/8 and new highs underscore the structure that fed the move and is key longer term.


 NG D 10 8 2021

Weekly:  Natural gas continued to it's major target. the double top potential from 2014 which equated nicely to over 8/8 Weekly and showed true impulse off that to rebalance Chikou.  It's now a question of degree, 3 or 5?  Impulse just shy of the 8/8 and Tenkan confluence.  Recall the impulse wave powered from the spit of 50wma to get over weekly Kijun and Tenkan.  This was energised  with a series of fractals between old 38 and 50% channel, as you would expect in a seasonal commodity with weather a prime mover. Resistance is Fib/Murrey confluence, support Tenkan, Kijun - as always count your ABC's

 NG W 10 8 2021

NG W 10 8 2021 2014 2021 double top
 

Natural Gas Storage Analysis

via RonH Data ‏@ronh999

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via Brynne Kelly @BrynneKKelly

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Natural Gas Production Watch

Refinitiv analysts forecasted that U.S. production would reach 95 Bcf/d for this winter, up from around 91 Bcf/d this month. At that level, the firm said, supplies should prove sufficient for domestic heating needs and continued strong levels of U.S. liquefied natural gas (LNG) exports to help meet demand in Europe and Asia. Production proved slow to recover from the pandemic, even as demand surged over the summer, and in recent weeks hurricane activity wreaked havoc in the Gulf of Mexico, further delaying increases in advance of winter. The specter of additional hurricanes will lurk into October.

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Natural Gas LNG Watch

“While year-over-year net exports ran 4.0 Bcf/d higher in April and May, the increase in net exports accelerated to 6.3 Bcf/d in June and 8.4 Bcf/d month-to-date in July,” the EBW team. “Although the dramatic increase was telegraphed to the market in advance, the increase in LNG and pipeline exports to Mexico draws almost exclusively from the South Central region — placing upward pressure on Henry Hub.”

via Criterion @Pipelineflows, RonH Data ‏@ronh999

Natural Gas feed to LNG facilities Sabine Pass, Cameron, Elba Island, Cove Point & Corpus Christi

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LNG netbacks for deliveries from the US Gulf Coast to Asia and Europe have surged above $9/MMBtu in recent days, up from around $8/MMBtu at the beginning of the month and around $7/MMBtu at the beginning of July. JKM, the benchmark price for spot LNG delivered to Northeast Asia, was assessed at $16.95/MMBtu on Aug. 13.

The run-up has led to a flurry of medium-term commercial transactions in recent months tied to US volumes that are linked to the JKM. Gas deliveries to US LNG export terminals totaled 10.91 Bcf/d on Aug. 13, based on the morning cycle, Platts Analytics data showed. That was up 540 MMcf/d from the day before and was the highest level since July 30. The increase came after production ramped up at Cheniere Energy's Sabine Pass and Sempra's Cameron LNG, both in Louisiana, and at Freeport LNG in Texas. - S&P Global Platts

US Gulk Coast LNG Netbacks
 

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In July 2020, US LNG facilities averaged 3.22 Bcf/day natgas inflow and 3.00 Bcf/day of LNG exports loaded on tankers. Lowest since Oct 2018. via https://public.tableau.com/profile/ron.h8

  ++Charts via RonH @RonH999 - Visit Ron for daily updates 

Natgas inflow and LNG Exported by US LNG facilities Sabine Pass, Cameron, Cove Point & Corpus Christi avg Bcf/day/month.

June 2021

U.S. liquefied natural gas exports were at record high levels in the first half of 2021

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For Full LNG Outlook Please Visit ourLNG Weekly Here

Natural Gas Mexican Exports Watch

via RonH Energy

US natural gas exports to Mexico established a new monthly record in June 2021

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Natural Gas Canada Import Watch

via RonH Energy

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Natural Gas Demand Watch

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ImageUS Feb 2021 pwCDD + gwHDD were 905. That is +111 vs the long term avg.

via RonH Data ‏@ronh999

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For Greater Depth Visit our Natural Gas Demand Monitor Here

US Feb Natural Gas demand by category.

Visit For Daily Updates ++Charts via RonH @RonH999  

Natural Gas Nuke Watch

via RonH Data ‏@ronh999

ALERT Three Mile Island nuclear shut down permanently on Friday afternoon 9/292019. US nuclear output for Sep 23 88,466.6 MW. This is -532.8 MW vs 5yr avg.

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Natural Gas Options Structure - Volatilty (COT)

NYMEX ON NATURAL GAS OPTIONS CommodityVol.com @CommodityImpVol

NYMEX ON = NATURAL GAS OPTIONS (Live Link)

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Natural Gas Futures Committment of Traders (COT)

 

Disaggregated Committment of Traders (DCOT)via RonH Data ‏@ronh999 @ole_s_hansen

Latest ICE and CFTC Open Interest Data: 

 

Understanding DCOT Reports

Read Understanding Commitments of Traders Reports - COT, TFF and DCOT  to help understand the disaggregated reports (DCOT) and how they break down the reportable open interest positions into four classifications: 1. Producer/Merchant/Processor/User 2. Swap Dealers 3. Managed Money 4. Other Reportables 

Natural Gas DCOT futures only managed money traders WoW change

(Note at NG peak Highest Longs Ever 87% (since 2006) Lowest Longs 2020 24%)

  • For week ending Oct 5
  • Natgas DCOT futures only managed money traders WoW change
  • -6,587 longs
  • -8,960 shorts
  • +2,373 net change
  • 54% net long

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Read Understanding Commitments of Traders Reports - COT, TFF and DCOT to help understand the disaggregated reports (DCOT) and how they break down the reportable open interest positions into four classifications:

1. Producer/Merchant/Processor/User 2. Swap Dealers 3. Managed Money 4. Other Reportables 

Sources: TradersCommunity Research, RonH Energy, The Fundamental Edge, Knovawave

From the Traders Community Research Desk

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