(Updates settlement price in paragraph 2, adds details on European gas markets, and updates Japan Korea Marker (JKM) prices in table) Aug 9 (Reuters) - U.S. natural gas futures jumped over 6% to a five-month high on Wednesday as sustained hotter-than-normal weather kept air conditioning demand high, especially in Texas. Front-month gas futures for September delivery on the New York Mercantile Exchange settled 18.2 cents, or 6.6%, higher at $2.96 per million British thermal units (mmBtu). "There's no question about the sustainability of natural gas demand over the past month or so because of the super hot weather and a lot of gas consuming areas in the United States," said Thomas Saal, senior vice president for energy at StoneX Financial. Prices rose above $3 per mmBtu earlier in the session, helped by short-covering from speculators, Saal said. Gas prices in Europe jumped as much as 39% to 43.31 euros per megawatt hour (MWh) earlier in the session after news of possible strikes at Australian liquefied natural gas (LNG) facilities sparked concerns over cargoes moving to Asia. The White House is continuing to watch the global energy market, national security spokesman John Kirby said on Wednesday when asked about a spike in natural gas prices in Europe. Power demand in Texas hit an all-time high on Monday and will likely break that record again this week as homes and businesses keep 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 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. 24. Data provider Refinitiv forecast U.S. gas demand, including exports, would rise from 102.9 billion cubic feet per day (bcfd) this week to 104.8 bcfd next week as power generators burn more of the fuel and exports rise. Those numbers were slightly lower from Tuesday's forecast. Refinitiv said average gas output in the U.S. Lower 48 states was 101.9 bcfd so far in August, nearly the same as the 101.8 bcfd in July. That compares with a monthly record of 102.2 bcfd in May. On a daily basis, however, output was on track to drop on a preliminary basis by 2.5 bcfd to more than a two-week low of 100.2 bcfd on Wednesday. Gas flows to the seven big U.S. LNG export plants have fallen from an average of 12.7 bcfd in July to 12.1 bcfd so far in August, mainly due to reductions at Cheniere Energy's Corpus Christi, Texas, facility and Sabine Pass plant in Louisiana and Venture Global LNG's Calcasieu facility 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): 25 14 44 46 U.S. total natgas in storage (bcf): 3,026 3,001 2,495 2,725 U.S. total storage versus 5-year average 11.0% 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 2.92 2.70 8.78 6.54 2.89 Title Transfer Facility (TTF) 12.04 9.72 69.68 40.50 7.49 Japan Korea Marker (JKM) 10.96 53.22 34.11 8.95 11.03 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 2 1 3 4 U.S. GFS CDDs 248 248 195 196 189 U.S. GFS TDDs 249 250 196 199 193 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 102.3 101.9 102.2 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 109.7 109.2 109.4 107.9 100.8 U.S. Demand (bcfd) U.S. Exports to Canada 1.7 1.6 1.6 2.5 2.5 U.S. Exports to Mexico 6.4 6.5 6.4 5.7 5.6 U.S. LNG Exports 12.7 12.2 12.5 9.8 6.1 U.S. Commercial 4.4 4.4 4.4 4.4 4.5 U.S. Residential 3.5 3.5 3.5 3.5 3.4 U.S. Power Plant 47.4 45.9 47.4 44.4 41.2 U.S. Industrial 21.3 21.3 21.4 21.4 21.5 U.S. Plant Fuel 5.1 5.0 5.1 5.0 5.0 U.S. Pipe Distribution 2.2 2.2 2.2 2.2 2.3 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 84.0 82.6 84.2 81.0 78.0 Total U.S. Demand 104.8 102.9 104.8 99.0 92.2 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended Aug 11 Aug 4 Jul 28 Jul 21 Jul 14 Wind 8 7 7 7 7 Solar 4 4 4 4 4 Hydro 5 5 5 6 6 Other 2 2 2 2 2 Petroleum 0 0 0 0 0 Natural Gas 45 45 45 46 45 Coal 19 20 20 19 19 Nuclear 17 17 16 17 17 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 2.77 2.65 Transco Z6 New York 1.33 1.30 PG&E Citygate 5.77 6.03 Eastern Gas (old Dominion South) 1.17 1.12 Chicago Citygate 2.45 2.41 Algonquin Citygate 1.41 1.80 SoCal Citygate 4.99 7.59 Waha Hub 2.34 2.19 AECO 2.68 2.62 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 26.75 33.75 PJM West 34.00 32.75 Ercot North 157.00 120.00 Mid C 67.50 98.00 Palo Verde 52.25 65.50 SP-15 54.50 72.50 (Reporting by Harshit Verma in Bengaluru; Editing by Paul Simao and Leslie Adler)
