Some parts of the United States have recently ushered in severe weather such as blizzard, storm, tornado and severe pollution. The pressure on the power grid has increased, and the demand for downstream heating has been increasing, driving the demand for natural gas to increase; On the other hand, because the largest railway freight union in the United States announced that it had rejected a temporary wage agreement from the White House, if no agreement could be reached, it would launch a strike on December 9, which would greatly affect the domestic coal supply in the United States, drive the demand for alternative heating energy such as natural gas to increase, and lead to a sharp rise in the price of natural gas in the United States.
I. Summary of International Natural Gas MarketMarket profile
As of November 22, the US natural gas futures price was 7.406 US dollars/million British heat, up 1.473 US dollars/million British heat from the previous cycle (11.15), an increase of 24.83%; Dutch natural gas futures price was USD 36.115/million British heat, up USD 1.792/million British heat or 5.22% from the previous cycle (11.15).
In the United States, the futures price of Port Henry (HH) in the United States is on the rise. Due to frequent disastrous weather in various parts of the United States this week, New York, California and other places have entered a state of emergency due to snowstorms, and Texas has entered a state of emergency due to tornadoes, storms and heavy air pollution. The pressure on the power grid has increased, driving up the demand for natural gas; On the other hand, The SMART Transportation Division, the largest railway freight union in the United States, announced that, The union rejected a temporary wage agreement brokered by the White House. If the negotiators fail to reach an agreement within two weeks, the union will start a strike on December 9, which will greatly affect the domestic coal transportation industry in the United States and lead to a sharp increase in the price of alternative energy sources such as natural gas.
In Europe, the inventory in the European market continues to increase, and the weather in Europe has recently warmed up, and the demand for LNG imports has weakened, inhibiting price increases; However, speculators are waiting for the price, and the liquidity of LNG spot is weak, which promotes the rise of TTF price. However, the European Commission's bill on natural gas ceiling puts forward that the rise of natural gas price is limited to a certain extent, so TTF futures price is in a volatile upward trend.
At present, the overall price of major international consumption places is on the rise, which is mainly due to the overall high inventory in various places, the weakening liquidity of LNG spot, the more psychology of market speculators waiting for the price, the stock hoarding behavior in the market, and the price will continue to fluctuate and adjust.
Chart 1: International natural gas market price unit: USD/million British heat
Inventory
In the week ending November 11, according to the US Energy Agency report, the US natural gas inventory was 3,644 billion cubic feet, an increase of 64 billion cubic feet from the previous month, an increase of 1.79%; Inventories are 400 cubic feet higher than the same period last year, an increase of 0.1%; It is 70 billion cubic feet lower than the five-year average, a decrease of 0.2%.
As of the week of November 11, according to the data of the European Natural Gas Infrastructure Association, the European natural gas inventory was 3,767.622 billion cubic feet, up 20.553 billion cubic feet or 0.55% from the previous month; Inventories were 849.349 billion cubic feet higher than the same period last year, an increase of 29.10%.
This week, the increase in US export supply led to a slowdown in the growth of domestic inventories, but the inventory level increased slightly compared with the same period of last year, and domestic reserves were relatively abundant. European inventory is almost full, and there is not much room for inventory to rise. With the recent drop in temperature and increase in consumption, the inventory level may show negative growth in the market outlook.
Chart 2: International natural gas inventory trend
Analysis of supply and demand situationSupply:
This week (11.10-11.16), the survey data of the operating rate of 223 LNG plants in China showed that the actual output was 644.3 million cubic meters, and the operating rate on Wednesday was 61.1%, up 1.9 percentage points from last week. On Wednesday, the operating rate of effective production capacity was 64.1%, up 1.9 percentage points from last week. The number of newly added shutdown and maintenance factories is 1, with a total production capacity of 2 million m3/day; The number of newly added resumption factories is 2, with a total production capacity of 1.5 million m3/day.
In terms of marine liquid, 18 LNG carriers were received at 12 domestic receiving stations in this cycle, and the number of receiving ships decreased by 2 compared with last week, with the arrival volume of 1,220,900 tons, down 12.42% from 1.394 million tons last week. The main import sources in this cycle are Australia, Qatar and Russia, with arrivals of 500,400 tons, 280,200 tons and 139,400 tons respectively. In terms of receiving stations, PetroChina Caofeidian received 3 ships, CNOOC Zhuhai, Sinopec Dongjiakou, State Grid Diefu and CNOOC Dapeng each received 2 ships, and other receiving stations each received 1 ship.
Requirements:
This week (11.16-11.22), the total domestic LNG demand was 536,200 tons, an increase of 10,400 tons or 1.98% compared with last week (11.09-11.15). The total shipment volume of domestic factories was 407,600 tons, an increase of 7,700 tons or 1.93% compared with last week (11.09-11.15). Due to the continuous price reduction of upstream shipments and the full opening of heating season, downstream demand has been boosted.
In terms of marine liquid, the total batch shipment of domestic receiving stations was 6,271 vehicles, up 2.08% compared with 6,143 vehicles last week (11.09-11.15). This week, there was still pressure to receive ships at receiving stations, and some receiving stations led to a drop in shipment prices, which led to an increase in batch shipment of tanks.
Research on market mentality
Domestic mainstream view 1:Next week, the country will cool down on a large scale, and the demand for urban fuel replenishment will increase
Domestic mainstream view 2:The pressure of receiving ships at some receiving stations is still relatively large, which will drive down the market shipping price
International mainstream views:Due to the frequent occurrence of extreme weather in North America, the demand for natural gas in the region will increase, which may drive the market price higher
Chart 4: Investigation on the mentality of LNG industry next week
Third, next week's trend forecastDomestic price forecast
At present, the domestic upstream price keeps falling, but due to the expectation of cooling in the future, the downstream demand of the market may increase, which will drive up the market price.
International price forecast
The market price in Northeast Asia will show an upward trend, and the downstream of the market will be affected by the increase of heating demand, which will drive the increase of LNG imports.It is expected that the market price will keep rising in the future.
TTF futures prices will show a downward trend next week, and the temperature in Europe will rise slightly, which will lead to a decrease in downstream demand in the market. As the overall market inventory remains high at present, there is no bullish news for European natural gas at present, and it is expected that TTF futures prices will show a downward trend in the future.
The price of natural gas futures in the United States will show an upward trend. Due to the severe cold weather in the United States and frequent disasters such as tornadoes in some areas, the pressure on the power grid will increase and the demand for heating will increase. If the American Railway Union starts to strike, the demand for downstream natural gas will increase greatly, driving up the price of HH.
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