US natgas prices edge up 1% on rising LNG feedgas, spike in European prices

Adds latest prices

By Scott DiSavino

Nov 15 (Reuters) - U.S. natural gas futures edged up about 1% on Friday due to an increase in the amount of gas flowing to U.S. liquefied natural gas $(LNG)$ export plants to a 10-month high and the recent spike in gas prices in Europe to an 11-month high.

Capping that price increase was a rise in daily output and forecasts for less cold weather in late November than previously expected, which should reduce heating demand and allow utilities to continue injecting more gas into storage for another week.

Front-month gas futures NGc1 for December delivery on the New York Mercantile Exchange rose 3.8 cents, or 1.4%, to settle at $2.823 per million British thermal units (mmBtu).

For the week, the front-month was up about 6%, putting it up for a fourth week in a row for the first time since September. During those four weeks, the contract has gained about 25%.

Analysts said utilities likely added more gas to storage than usual during the mild week ended Nov. 15. If correct, that would be the first time inventories rose by more than usual for five weeks in a row since October 2022.

There was currently about 7% more gas is in storage than normal for this time of year. EIA/GAS NGAS/POLL

Prior to the last moth or so, however, injections had been smaller than usual for 14 straight weeks because many producers reduced drilling activities this year after average spot monthly prices at the U.S. Henry Hub NG-W-HH-SNL benchmark in Louisiana fell to a 32-year low for the month of March, and have remained relatively soft since then.

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states eased to 100.3 billion cubic feet per day (bcfd) so far in November, down from 101.3 bcfd in October. That compares with a record 105.3 bcfd in December 2023.

On a daily basis, output rose by about 2.7 bcfd over the prior four days to 101.2 bcfd on Thursday, up from a nine-month low of 98.4 bcfd on Nov. 10.

Meteorologists projected weather in the Lower 48 states will remain mostly warmer than normal through Nov. 30 except for some near normal days from Nov. 21-24.

But with seasonally colder weather coming, LSEG forecast average gas demand in the Lower 48, including exports, would rise from 108.1 bcfd this week to 109.1 bcfd next week and 117.7 bcfd in two weeks. The forecasts for this week and next were lower than LSEG's outlook on Thursday.

The amount of gas flowing to the seven big operating U.S. LNG export plants edged up to an average of 13.3 bcfd so far in November, up from 13.1 bcfd in October. That compares with a monthly record high of 14.7 bcfd in December 2023.

On a daily basis, LNG feedgas was on track to rise to a 10-month high of 14.4 bcfd on Friday with flows to a few plants hitting multi-week highs in recent days.

The U.S. became the world's biggest LNG supplier in 2023, ahead of recent leaders Australia and Qatar, as much higher global prices feed demand for more exports due in part to supply disruptions and sanctions linked to Russia's invasion of Ukraine in February 2022.

Gas prices traded near an 11-month high of around $14 per mmBtu at the Dutch Title Transfer Facility (TTF) benchmark in Europe TRNLTTFMc1 on supply concerns after Russia told Austria it would suspend gas deliveries from Saturday. NG/EU

(Reporting by Scott DiSavino; editing by David Evans and Nick Zieminski)

((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net))

For gas data on the LSEG terminal type ENERGY in the search bar and then go to the GAS drop down and the NORTH AMERICA drop down.

For Interactive Map, type 'Interactive Map' in the box at upper left of the LSEG terminal

For graphics on Baker Hughes rig counts, see: http://graphics.thomsonreuters.com/15/rigcount/index.html

For next-day SNL U.S. gas prices, see: 0#SNL-NG

For next-day SNL U.S. power prices, see: 0#SNL-PWR

For U.S. natgas price and storage polls, see: NGAS/POLL

For U.S. nuclear power outages, see: NUKE/

For U.S. Northwest hydro power report, see: NWRFC

For U.S./Canada natural gas rig count vs Henry Hub futures price, see: http://tmsnrt.rs/2eT9k44

For the U.S. natural gas speed guide, see: USGAS

For the U.S. power speed guide, see: USPOWER

To determine CFTC managed money net position add (NYMEX Henry Hub options and futures combined 3023651MNET) plus (ICE Henry Hub options and futures combined 3023391MNET divided by four) plus (NYMEX Henry Hub swaps options and futures combined 303565BMNET divided by four) plus (NYMEX Henry Hub penultimate gas swaps 303565CMNET divided by four)

NYMEX Henry Hub options and futures combined 0#3CFTC023651

NYMEX Henry Hub futures only 0#1CFTC023651

ICE Henry Hub options and futures combined 0#3CFTC023391

NYMEX Henry Hub swaps options and futures combined 0#3CFTC03565B

NYMEX Henry Hub Penultimate gas swaps 0#3CFTC03565C