US natgas prices jump 9% to 1-year high on cold forecasts, rising LNG feedgas

By Scott DiSavino

Nov 25 (Reuters) - U.S. natural gas futures jumped about 9% to a one-year high on Monday on forecasts for colder weather, rising gas flows to U.S. liquefied natural gas export plants and soaring global gas prices.

On its second to last day as the front-month, gas futures NGc1 for December delivery on the New York Mercantile Exchange (NYMEX0 rose 27.3 cents, or 8.7%, to $3.402 per million British thermal units (mmBtu) at 10:12 a.m. EST (1512 GMT), putting the contract on track for its highest close since November 2023.

Futures for January NGF25, which will soon be the front-month, were up about 22 cents per mmBtu to $3.51.

That leaves the premium of futures for January over December NGZ24-F25 at around 12 cents per mmBtu, the lowest since February 2022.

With gas futures up about 39% over the past five weeks, speculators last week cut their net short futures and options positions on the New York Mercantile and Intercontinental Exchanges to the lowest since mid-October, according to the U.S. Commodity Futures Trading Commission's Commitments of Traders report.

Total gas futures volume NG-TOT traded on the NYMEX, meanwhile, jumped to 1.007 million on Nov. 21, the highest since March 2020.

In other news, EQT EQT.N, the second biggest U.S. gas producer, said asset manager Blackstone BX.N would buy minority stakes in some of EQT's pipelines for $3.5 billion in cash through a joint venture.

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states edged up to 101.2 billion cubic feet per day so far in November, up from 101.1 bcfd in October. That compares with a record 105.3 bcfd in December 2023.

On a daily basis, output hit a three-month high of 103.4 bcfd on Saturday.

Analysts expect producers to boost output in 2025 following a series of production cuts this year, as rising demand from LNG export plants increases prices.

Annual average gas prices at the U.S. Henry Hub NG-W-HH-SNL benchmark in Louisiana were expected to rise over 40% in 2025 after dropping to a four-year low in 2024, analysts projected. NGAS/POLL

Meteorologists projected weather in the Lower 48 will remain mostly near normal through Dec. 10 except for several colder-than-normal days from Nov. 29-Dec. 4.

With colder weather coming, LSEG forecast average gas demand in the Lower 48, including exports, would jump from 115.4 bcfd this week to 132.4 bcfd next week. Those forecasts were lower than LSEG's outlook on Friday.

The amount of gas flowing to the seven big operating U.S. LNG export plants rose to an average of 13.5 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 hold at a preliminary two-week low of 13.3 bcfd on Monday, the same as Sunday, on reductions at Cheniere Energy's LNG.N Sabine Pass in Louisiana, Cameron LNG's plant in Louisiana and Freeport LNG's plant in Texas.

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 a one-year high of $15 per mmBtu at the Dutch Title Transfer Facility benchmark in Europe TRNLTTFMc1 and near an 11-month high of $15 at the Japan-Korea Marker JKMc1 benchmark in Asia. NG/EU

(Reporting by Scott DiSavino; editing by Jonathan Oatis)

((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.

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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