* Benchmark Hub remains under recent 21-month high
* Cooler weather back in Midcontinent, Texas
* Heat hits the West Coast
* Coming Up: EIA natgas storage data Thursday
By Eileen Houlihan
NEW YORK, May 1 (Reuters) – U.S. spot natural gas prices
rose across the nation for a third straight day on Wednesday,
boosted by forecasts for cooler weather in the Midcontinent and
the South and very warm weather on the West Coast.
MDA Weather Services called for much-above-normal
temperatures along the West Coast and in the Northeast in its
one to five-day forecast map, with a large swath of
much-below-normal readings in the middle of the nation and
across the South.
Snow was on tap for parts of the Midwest, Accuweather.com
said, with Winter Storm Achilles likely to set snowfall records
from Nebraska into Wisconsin and dump snow across the Rockies
and Wyoming.
Traders also said expectations for another light weekly
inventory build on Thursday was adding momentum to the upside
and helping to support gas futures for most of the day.
A long cold winter put a huge dent in inventories, and
lingering cool weather across the nation this spring has led to
a slow start to the injection season.
Gas for Thursday delivery at benchmark Henry Hub
in Louisiana rose 1 cent on average to $4.31 per million British
thermal units, after gaining 2 cents on Tuesday for gas
delivered on Wednesday.
Just over a week ago Hub cash rose to a 21-month high of
$4.38.
Hub cash prices are up nearly 24 percent since March 1.
But with milder, spring-like temperatures expected to kick
in soon, traders expect most lingering heating demand to finally
taper off before heavy cooling loads start, making further
upside moves difficult.
Wednesday’s Hub average was a little less than double the
year-ago price of $2.29. Cash prices bottomed just over a year
ago at a 10-year low of $1.82.
Late deals firmed slightly to 7 cents under the front-month
June natural gas futures contract on the New York Mercantile
Exchange, from deals done early Tuesday at an 8-cent
discount.
The nearby futures contract slid 1.7 cents to settle at
$4.326, after rising as high as $4.444, its highest mark since
late July 2011.
In consuming regions, gas on the Transco pipeline at the New
York citygate rose 1 cent to average $4.49, while
Chicago gas was 7 cents higher on the day at $4.43.
Gas at the Southern California border , reflecting
the warmer weather in the West, rose 6 cents to average $4.35.
Nuclear outages totaled 22,800 megawatts, or 23 percent of
U.S. capacity, down from 24,800 MW out on Tuesday, 23,900 MW out
a year ago and a five-year average outage rate of 23,900 MW.
ANOTHER LIGHT INVENTORY BUILD
Last week’s gas storage report from the U.S. Energy
Information Administration showed domestic inventories rose the
prior week by 30 billion cubic feet, below Reuters poll
estimates for a 32 bcf build, the year-ago gain of 43 bcf and
the five-year average build of 50 bcf for that week.
Inventories also started the injection season about three
weeks later than expected due to the unusually cold spring.
Stocks, at 1.734 trillion cubic feet, are nearly 32 percent
below last year and more than 5 percent below the five-year
average.
(Storage graphic: http://link.reuters.com/mup44s)
Injection estimates for this week’s storage report ranged
from 22 bcf to 35 bcf, with most analysts expecting data to show
a build of about 28 bcf when it is released early Thursday, a
Reuters poll showed.
Stocks rose 31 bcf during the same week last year and on
average over the past five years have gained 67 bcf that week.
EIA data on Tuesday showed gross natural gas production in
February climbed for the first time in three months. Output rose
to about 1.27 bcf per day, or 1.8 percent above the same month
last year, after dropping below year-ago levels in January for
the first time since 2010.
The report dimmed prospects that record high production
would slow anytime soon despite Baker Hughes gas drilling rig
data last week that showed the rig count dropped to a 14-year
low.
(Rig graphic: http://link.reuters.com/nuz86t)
Average prices at spot gas market points and previous day
prices follow (US$/mmBtu):
5/01/13 4/30/13
Henry Hub 4.31 4.30
New York citygate 4.49 4.48
Chicago citygate 4.43 4.36
Panhandle (mid-Continent) 4.15 4.12
Northern at Demarcation (Minn.) 4.36 4.30
Southern California border 4.35 4.29
Katy Hub (east Texas) 4.32 4.30
Waha (west Texas) 4.27 4.25
Dominion-South (Appalachia region) 4.29 4.28
Columbia TCO (Appalachia region) 4.35 4.34
For more U.S. spot natural gas prices, click on
RELATED LINKS
– U.S. Spot Gas versus Oil Comparisons……….
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– U.S. EEI Electricity Output Report ………..
– NYMEX Natural Gas Futures ………………..
– NYMEX Crude Oil Futures …………………..
(Editing by Marguerita Choy)
