Reversible production, falling demand brings U.S. gas prices back below $ 3

Key points

Permian, Hayneville rise, raising U.S. output 11 Bcf / d

U.S. demand at 111 Bcf, down 27% from a recent high

Prices for Midcon, East Texas, Henry Hub fall below $ 3

New York –
U.S. natural gas prices fell back to familiar ground in the $ 2 to $ 3 / MMBtu range in February 22 trading as the storm-led supply crisis continued easily amid rising output and falling demand.

At noon, U.S. currency benchmark Henry Hub traded at $ 2.84 / MMBtu, down more than $ 2 from the previous session’s settlement, data from Intercontinental Exchange showed.

In the hard Midcontinent sector, prices also continued to fall at ANR, Okla., Enable Gas, NGPL Midcontinent, ONEOAK, Okla., Panhandle, and Southern Star – all trading in a narrow range between the highs. $ 2.50s to low- $ 2.70s, down from prices as high as $ 1,100 / MMBtu last week.

In East Texas, where money markets have climbed into the recent hundreds, prices were down, with Houston Ship Channel and Katy Hub both pricing in the $ 2.50s / MMBtu area.

Production

Over the weekend, temperatures in Midland, Texas soared into the 60s Fahrenheit – up from a low in the same numbers last week – allowing for lost production in the Permian Lake that was nearby get past it. On February 22, yields from West Texas were estimated at 11.1 Bcf / d, about 2.7 Bcf already above its recent low-storm data, S&P Global Platts Analytics data showed.

In East Texas, producers in the Haynesville recovered from frigid weather as temperatures rose in Shreveport, La., In the mid-60s F. In Haynesville, production was estimated Feb. 22 at 10.5 Bcf / d – up more than 4.2 Bcf over the weekend from the storm level itself low.

At the U.S. level, lower production gains over other dishes, including Denver-Julesburg, the Bakken, the SCOOP / STACK and the Gulf of Offshore Mexico, boosted gross domestic product to 85.8 Bcf / d Feb. 22 – nearly 11 Bcf over last year. the lowest week in three years, Platts Analytics data showed.

Request

As U.S. production continues to climb, warmer weather has led to a 27% decline in total gas demand from mid-February to an estimate of 111.2 Bcf / d February 22. How pressure temperatures U.S. population continues to warm up to more than 50 degrees by the coming weekend, total domestic demand including exports is expected to fall below 100 Bcf / d .

In the Mediterranean, regional demand was estimated at around 4.9 Bcf / d February 22, or at just 41% of its recent record high. In another sign of a market slowdown, gas emissions from the Midcontinent resumed over the weekend, hitting 1 Bcf / d Feb. 22, the highest level since Feb. 9.

In Texas, demand fell to 13.7 Bcf / d Feb. 22, down from Lone Star State’s own record high last week at 23.7 Bcf / d. Gas exports from the state also rose over the weekend, with pipeline outflows rising to 7.9 Bcf / d and LNG exports from Freeport and Corpus Christi hitting 1.9 Bcf / d combined.

Forward

In the Midcontinent, forward gas prices for the February-March balance have remained at more than $ 3 / MMBtu amid concerns about further supply disruptions and potential storage shortages this winter.

In East Texas, balmo prices at Houston Ship Channel and Katy ended trading at over $ 4 / MMBtu Feb. 19, with March priced in the low- $ 3s / MMBtu M2MS data displays, S&P Global Platts recently published.