(Adds settlement prices in paragraph 2, updates milestone) Aug 7 (Reuters) - U.S. natural gas futures rose more than 4% to nearly a two-week high on Monday on forecasts for higher demand over the next week because of hotter-than-expected weather through mid-August, especially in Texas. Front-month gas futures for September delivery on the New York Mercantile Exchange settled 0.148 cent, or 5.7% higher, at $2.725 per million British thermal units (mmBtu). The contract also touched its highest since July 25. "We're getting a little bit of a bounce to start the week on the hot temperatures," said Phil Flynn, an analyst at Price Futures Group. Power demand in Texas hit an all-time high last week and will likely break that record again this week as homes and businesses keep their air conditioners cranked up during the lingering heat wave, according to forecasts by the Electric Reliability Council of Texas (ERCOT), the state's power grid operator. Extreme heat boosts the amount of gas burned to produce power for cooling, especially in Texas, which gets most of its electricity from gas-fired plants. In 2022, about 49% of the state's power came from gas-fired plants, with most of the rest coming from wind (22%), coal (16%), nuclear (8%) and solar (4%), federal energy data showed. Meteorologists forecast the weather in the Lower 48 states will remain hotter than normal through at least Aug. 19. Data provider Refinitiv forecast U.S. gas demand, including exports, will rise from 102.4 bcfd this week to 105.8 bcfd next week as power generators burn more of the fuel and exports rise. Refinitiv said average gas output in the U.S. Lower 48 states was 102.2 billion cubic feet per day (bcfd) so far in August, up from 101.8 bcfd in July and matching the monthly record in May. Gas flows to the seven big U.S. LNG export plants have fallen from an average of 12.7 bcfd in July to 12.3 bcfd so far in August due mostly to a reduction at Cheniere Energy's Sabine Pass in Louisiana. That compares with a monthly record of 14.0 bcfd in April. The U.S. is on track to become the world's biggest LNG supplier in 2023 - ahead of recent leaders Australia and Qatar - as much higher global prices continue to feed demand for U.S. exports due to supply disruptions and sanctions linked to the war in Ukraine. In 2022, roughly 69%, or 7.2 bcfd, of U.S. LNG exports went to Europe as shippers diverted cargoes from Asia to get higher prices. In 2021, when prices in Asia were higher, just 35%, or about 3.3 bcfd, of U.S. LNG exports went to Europe. With the return of higher gas prices in Asia this year, analysts said they expect U.S. LNG exports to Asia will increase. But that has not happened yet. Just 19%, or 2.1 bcfd, of U.S. LNG exports went to Asia during the first half of 2023, while 70%, or 8.0 bcfd, went to Europe. Week ended Week ended Year ago Five-year Aug 4 Jul 28 Aug 4 average Forecast Actual Aug 4 U.S. weekly natgas storage change (bcf): 28 14 44 46 U.S. total natgas in storage (bcf): 3,029 3,001 2,495 2,725 U.S. total storage versus 5-year average 11.2% 12.0% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2022 (2017-2021) Henry Hub 2.69 2.57 8.78 6.54 2.89 Title Transfer Facility (TTF) 9.66 9.14 69.68 40.50 7.49 Japan Korea Marker (JKM) 10.96 11.00 53.22 34.11 8.95 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 1 1 1 3 4 U.S. GFS CDDs 244 244 204 198 191 U.S. GFS TDDs 245 245 205 201 195 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 102.3 102.4 102.5 99.0 92.0 U.S. Imports from Canada 7.4 7.3 7.2 8.9 8.1 U.S. LNG Imports 0.0 0.0 0.0 0.0 0.1 Total U.S. Supply 109.7 109.7 109.7 107.9 100.8 U.S. Demand (bcfd) U.S. Exports to Canada 1.7 1.7 1.6 2.5 2.5 U.S. Exports to Mexico 6.4 5.7 6.4 5.7 5.6 U.S. LNG Exports 12.7 12.6 13.2 9.8 6.1 U.S. Commercial 4.4 4.4 4.4 4.4 4.5 U.S. Residential 3.5 3.6 3.5 3.5 3.4 U.S. Power Plant 47.4 45.6 47.7 44.4 41.2 U.S. Industrial 21.3 21.3 21.4 21.4 21.5 U.S. Plant Fuel 5.1 5.1 5.1 5.0 5.0 U.S. Pipe Distribution 2.2 2.2 2.3 2.2 2.3 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 84.0 82.3 84.6 81.0 78.0 Total U.S. Demand 104.8 102.3 105.8 99.0 92.2 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended Aug 4 Jul 28 Jul 21 Jul 14 Jul 7 Wind 7 7 7 7 6 Solar 4 4 4 4 4 Hydro 5 5 6 6 6 Other 2 2 2 2 2 Petroleum 0 0 0 0 0 Natural Gas 45 45 46 45 45 Coal 20 20 19 19 19 Nuclear 17 16 17 17 18 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 2.53 2.44 Transco Z6 New York 1.16 1.21 PG&E Citygate 5.74 5.31 Eastern Gas (old Dominion South) 1.14 1.11 Chicago Citygate 2.29 2.26 Algonquin Citygate 1.45 1.50 SoCal Citygate 9.05 8.50 Waha Hub 2.22 2.17 AECO 2.47 1.82 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 27.50 32.00 PJM West 31.25 35.00 Ercot North 170.00 145.00 Mid C 107.43 110.00 Palo Verde 54.25 70.25 SP-15 53.00 71.00 (Reporting by Harshit Verma and Rahul Paswan in Bengaluru; Additional reporting by Brijesh Patel; Editing by Paul Simao and Marguerita Choy)
