(Adds latest prices) June 16 (Reuters) - U.S. natural gas futures gained about 4% to a three-month high on Friday on a recent drop in output and forecasts for demand to soar as the weather turns hot in late June, especially in Texas. Power use in Texas is expected to break records next week as homes and businesses crank up their air conditioners to escape the first heat wave of the 2023 summer season, the state's power grid operator projected on Friday. That will boost the amount of gas burned by power generators, since Texas gets most of its power from gas. In 2022, about 49% of the state's power came from gas-fired plants, with most of the rest from wind (22%), coal (16%), nuclear (8%) and solar (4%), according to federal energy data. In addition to preparing for the coming heat, utilities in Texas and other Gulf Coast states were restoring power to over 664,000 customers left without service after severe storms battered the region. Front-month gas futures for July delivery on the New York Mercantile Exchange rose 9.9 cents, or 3.9%, to settle at $2.632 per million British thermal units (mmBtu), their highest close since March 7. That put the front-month up for a fifth day in a row and a 10th time in the last 11 days. Those price gains also kept the contract in technically overbought territory, with a relative strength index (RSI) above 70 for a second day in a row for the first time since mid-May. For the week, the front-month rose about 17% after gaining about 4% last week. That was its biggest weekly gain since early March when it jumped about 23%. In Europe, meanwhile, gas prices at the Dutch Title Transfer Facility (TTF) benchmark remained extremely volatile, plunging by around 22% on Friday after rising about 65% during the prior seven days. SUPPLY AND DEMAND Data provider Refinitiv said average gas output in the U.S. Lower 48 states has slid to 101.9 billion cubic feet per day (bcfd) so far in June, down from a monthly record of 102.5 bcfd in May. As the wildfires in Alberta and other Canadian provinces died down, gas exports from Canada were on track to rise to 8.3 bcfd on Friday, up from 7.4 bcfd on Thursday and 7.2 bcfd on Tuesday and Wednesday. That compares with average Canadian exports of 7.8 bcfd so far in June, 7.4 bcfd in May when the wildfires were raging, 8.3 bcfd so far in 2023 and 9.0 bcfd in 2022. About 8% of the gas consumed in or exported from the United States comes from Canada. Meteorologists forecast the weather would remain mostly near normal from June 16-22 before turning hotter than normal from June 23-July 1. With warmer weather coming, Refinitiv forecast U.S. gas demand, including exports, would rise from 93.2 bcfd this week to 96.0 bcfd next week and 101.8 bcfd in two weeks. The forecasts for this week and next were similar to Refinitiv's outlook on Thursday. Gas flows to the seven big U.S. LNG export plants have fallen to an average of 11.6 bcfd so far in June from 13.0 bcfd in May. That is well below the monthly record high of 14.0 bcfd in April due to maintenance at several facilities, including Cheniere Energy Inc's Sabine Pass in Louisiana and Freeport LNG in Texas. Week ended Week ended Year ago Five-year Jun 16 Jun 9 Jun 16 average (Forecast) (Actual) Jun 16 U.S. weekly natgas storage change (bcf): 99 84 76 86 U.S. total natgas in storage (bcf): 2,733 2,634 2,158 2,367 U.S. total storage versus 5-year average 15.5% 15.5% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2022 (2018-2022) Henry Hub 2.60 2.53 7.60 6.54 3.60 Title Transfer Facility (TTF) 11.25 13.50 33.44 40.50 14.39 Japan Korea Marker (JKM) 13.69 9.40 29.72 34.11 14.31 Refinitiv Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days Two-Week Total Forecast Current Day Prior Day Prior Year 10-Year 30-Year Norm Norm U.S. GFS HDDs 7 7 9 10 10 U.S. GFS CDDs 191 190 198 168 168 U.S. GFS TDDs 197 197 207 178 177 Refinitiv U.S. Weekly GFS Supply and Demand Forecasts Prior Week Current Next Week This Week Five-Year Week Last Year Average For Month U.S. Supply (bcfd) U.S. Lower 48 Dry Production 102.3 101.7 101.3 97.5 89.8 U.S. Imports from Canada 7.0 6.5 6.7 8.9 7.9 U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1 Total U.S. Supply 109.3 108.1 108.0 106.4 97.8 U.S. Demand (bcfd) U.S. Exports to Canada 2.1 1.8 1.8 2.2 2.3 U.S. Exports to Mexico 6.7 6.4 6.5 6.2 5.5 U.S. LNG Exports 11.9 11.3 11.9 10.7 6.0 U.S. Commercial 4.5 4.5 4.5 4.5 4.7 U.S. Residential 3.8 3.8 3.8 3.7 4.3 U.S. Power Plant 38.1 37.1 39.1 38.2 34.8 U.S. Industrial 21.2 21.3 21.3 21.0 21.1 U.S. Plant Fuel 5.1 5.0 5.0 5.1 5.1 U.S. Pipe Distribution 2.0 2.0 2.0 2.0 1.8 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 74.9 73.8 75.8 74.6 71.9 Total U.S. Deman 95.6 93.2 96.0 93.7 85.7 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended Jun 16 Jun 9 Jun 2 May 26 May 19 Wind 8 5 10 9 8 Solar 5 5 5 5 4 Hydro 6 7 8 9 9 Other 2 2 2 2 2 Petroleum 0 0 0 0 0 Natural Gas 43 45 40 40 42 Coal 16 17 15 15 15 Nuclear 20 20 20 20 19 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 2.18 2.05 Transco Z6 New York 1.38 1.47 PG&E Citygate 2.93 2.86 Eastern Gas (old Dominion South) 1.31 1.31 Chicago Citygate 2.04 1.96 Algonquin Citygate 1.69 1.65 SoCal Citygate 3.76 3.15 Waha Hub 1.93 1.92 AECO 1.76 1.76 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 28.00 27.75 PJM West 29.00 28.50 Ercot North 80.00 30.00 Mid C 28.25 27.00 Palo Verde 25.50 20.75 SP-15 26.25 22.00 (Reporting by Scott DiSavino; Editing by Jonathan Oatis and Jan Harvey)
