Tom Nolan + 2,443 TN August 17, 2022 James Hyerczyk August 16 Tuesday Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest The early price action also suggests there may have been a shift in the overnight weather forecasts. https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-grinding-toward-summer-highs-despite-huge-short-interest-1096153 Natural gas futures are trading at their highest level since July 26 on Tuesday, continuing a rebound that began yesterday following a lower start to the week. A technical bounce in crude oil may be helping to bolster prices. However, the price action also suggests there may have been a shift in the overnight weather forecasts. At 11:12 GMT, October natural gas futures are trading $8.992, up $0.280 or +3.21%. On Monday, the United States Natural Gas Fund ETF (UNG) settled at $30.55, up $0.29 or +0.96%. Early Pressure to Start the Week The new week started with natural gas prices being dragged lower by a steep drop in crude oil prices. Rising supplies and forecasts calling for cooler weather also contributed to the early session weakness. However, late in the day, the market rebounded to recover most of those losses into the close. Crude oil prices also bounced from their intraday low, bringing some stability to the natural gas market. Are the Shorts Getting Nervous? Despite calls for hotter temperatures throughout the summer and uncertainty in Europe, short-sellers have been building a strong position since early June, helped by an outage at the Freeport LNG plant that made about 2 billion cubic feet (bcf) of gas available for domestic storage. This news helped alleviate concerns about a widening storage deficit heading into the winter heating season. Additionally, it was reported Friday that gas speculators boosted their net short futures and options positions on the New York Mercantile and Intercontinental Exchanges for a third week in a row to the most since March 2020, according to the U.S. Commodity Futures Trading Commission’s Commitment of Traders report. The question being asked is, how long will these shorts be able to hold on to their positions if buyers start to run this market through the two main tops at $9.382 and $9.568? Daily Forecast The early strength in the market indicates that buyers once again came in the dip following Monday’s early weakness despite calls for cooler weather during the latter part of August. The price action suggests there may have been a change in the overnight forecasts to the benefit of the bulls although NatGasWeather analysts were warning about the opportunity for extreme heat in the eight- to 15-day period over the West. With prices approaching a pair of tops at $9.382 and $9.568, and the huge amount of shorts in the market, traders are bracing for heightening volatility especially if some of the weaker short sellers start to run for cover. For a look at all of today’s economic events, check out our economic calendar. 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 17, 2022 Reuters - August 15th Monday https://finance.yahoo.com/news/u-natgas-futures-down-3-130744327.html U.S. natgas futures down 3% on rising output, lower demand Aug 15 (Reuters) - U.S. natural gas futures fell about 3% on Monday on rising supplies and forecasts for cooler weather and lower air conditioning demand over the next two weeks than previously expected. Also weighing on gas prices was a 5% drop in oil futures and the ongoing outage at the Freeport liquefied natural gas (LNG) export plant in Texas, which has left more gas in the United States for utilities to inject into stockpiles for next winter. Freeport LNG, the second-biggest U.S. LNG export plant, was consuming about 2 billion cubic feet per day (bcfd) of gas before it was shut on June 8. Freeport expects the plant to return to at least partial service in early October. Front-month gas futures fell 28.1 cents, or 3.2%, to $8.487 per million British thermal units (mmBtu) at 8:42 a.m. EDT (1242 GMT). Recent declines in crude prices have cut oil's premium over gas to its lowest since April 2020 when crude briefly turned negative. Over the last several years that premium has prompted U.S. energy firms to focus most of their drilling activity on finding more oil instead of gas because crude was by far the more valuable commodity. The oil-to-gas ratio, or level at which oil trades compared with gas, dropped to 10-to-1 on Monday. So far in 2022, crude has traded about 17 times over gas. That compares with crude's average premium over gas of 19 times in 2021 and a five-year average (2017-2021) of 20 times. On an energy equivalent basis, oil should trade only six times over gas. Last week, gas speculators boosted their net short futures and options positions on the New York Mercantile and Intercontinental Exchanges for a third week in a row to the most since March 2020, according to the U.S. Commodity Futures Trading Commission's Commitments of Traders report. So far this year, the gas front-month was up about 128% as higher prices in Europe and Asia keep demand for U.S. LNG exports strong. Global gas prices have soared this year following supply disruptions linked to Russia's invasion of Ukraine on Feb. 24. Gas was trading around $64 per mmBtu in Europe and $45 in Asia. The United States became the world's top LNG exporter during the first half of 2022. But no matter how high global gas prices rise, the United States cannot export more LNG because the country's plants are already operating at full capacity. Russian gas exports via the three main lines into Germany - Nord Stream 1 (Russia-Germany), Yamal (Russia-Belarus-Poland-Germany) and the Russia-Ukraine-Slovakia-Czech Republic-Germany route - have averaged 2.5 bcfd so far in August, down from 2.8 bcfd in July and 10.4 bcfd in August 2021. TOP PRODUCER U.S. gas futures lag far behind global prices because the United States is the world's top producer with all the fuel it needs for domestic use, while capacity constraints and the Freeport outage prevent the country from exporting more LNG. Data provider Refinitiv said average gas output in the U.S. Lower 48 states has risen to 97.6 bcfd so far in August from a record 96.7 bcfd in July. With warmer weather expected, Refinitiv projected average U.S. gas demand, including exports, would rise from 96.3 bcfd this week to 96.9 bcfd next week. Those forecasts were lower than Refinitiv's outlook on Friday. The average amount of gas flowing to U.S. LNG export plants has risen to 11.0 bcfd so far in August from 10.9 bcfd in July. That compares with a monthly record of 12.9 bcfd in March. The seven big U.S. export plants can turn about 13.8 bcfd of gas into LNG. ... STATISTICS FOLLOW in article. 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 18, 2022 US Thursday August 18th https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-double-digit-prices-likely-due-to-european-crisis-1099834 Natural Gas Price Fundamental Daily Forecast – Double-Digit Prices Likely Due to European Crisis By:James Hyerczyk Updated: Aug 18, 2022, 01:46 CDT Traders are betting on long-term bullish conditions to continue due to expected shortages in Europe and the fear of higher prices from Russia. Natural gas futures are trading flat Thursday after touching a 14-year high the previous session before settling lower. Today’s early price action suggests traders are sitting on the sidelines ahead of the U.S. government storage report later today. At 05:45 GMT, October natural gas futures are at $9.241, up $0.013 or +0.14%. On Wednesday, the United States Natural Gas Fund is trading $31.89, down $0.38 or -1.18%. Weather Shifts Fueling Heightened Volatility October natural gas futures traded higher early Thursday based on favorable overnight forecasts, but prices collapsed after midday forecasts called for less hot weather and lower air conditioning demand over the next two weeks than previously expected. The volatile reversal to the downside took place even though daily output fell and hotter-than-normal weather continued on the West Coast and Texas. Some of the selling was fueled by technical indicators signaling overbought conditions. Fundamental traders were also surprised by the strength in the market due to potentially bearish factors such as the ongoing Freeport outage, the upcoming hurricane season and rising production. Bullish International Developments Traders are betting on long-term bullish conditions to continue due to expected shortages in Europe and the fear of higher prices from Russia. Reuters reported on Thursday that Germany is likely to miss a November target for gas storage levels set by the government to avoid an energy crisis, according to the head of the Bundesnetzagentur energy regulator. He warned that Europe’s biggest economy faced two tough winters. Germany has already hit its first target for gas storage facilities to be 75% full by September 1. The next goals are for storage levels to be at 85% by October 1 and 95% by November 1. Klaus Mueller, head of the Bundesnetzagentur, told t-online, “I don’t expect we will achieve the next targets as quickly as the first one.” Earlier in the week, Russian state gas company Gasprom said on Tuesday that European gas prices could spike by 60% to more than $4,000 per 1,000 cubic meters this winter, as the company’s own export and production continues to fall amid Western sanctions. Short-Term Outlook Despite the reversal to the downside on Wednesday, natural gas is still long-term bullish. Furthermore, professionals have been more comfortable buying dips than chasing higher prices. A near-term correction will play right into their hands. The market is still likely to have a deficit to the five-year average despite more gas flowing into storage due to the Freeport outage and production has not been up to speed. However, the most compelling reason why U.S. natural gas is likely to touch double-digits are the soaring European gas prices. For a look at all of today’s economic events, check out our economic calendar. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ https://tradingeconomics.com/commodity/natural-gas US Natural Gas futures were trading around the $9.30/MMBtu mark, not far from a 14-year peak of $9.75/MMBtu hit in late July, buoyed by strong overseas and domestic demand. The temperatures in the US this summer remain high, with several heatwaves boosting demand for air conditioners. Meanwhile, Freeport LNG has recently agreed with regulators to partially restart operations in October at its shuttered export plant in Texas and said it began to pull in tiny amounts of natural gas from pipelines. The resumption of flows will withdraw more natural gas from storage and boost exports. Adding to woes, demand from Europe remains strong as the critical Nord Stream 1 pipeline from Russia to Germany is currently running at 20% capacity. EU Natural Gas https://tradingeconomics.com/commodity/eu-natural-gas Natural gas futures linked to TTF, Europe's wholesale gas price, were trading around the €230-per-megawatt-hour mark, not far from an all-time high of €300 hit in March in the aftermath of Russia's invasion of Ukraine, supported by a combination of tight supplies and soaring demand for power generation amid persistent heatwaves across Europe. A historic drought triggered by an arid summer that set heat records across Europe threatens to halt energy shipments along the Rhine River, exacerbating concerns about further supply disruptions. On top of that, Russia's Gazprom has reduced flows through the Nord Stream pipeline, citing issues with turbines, delivering only 33 million cubic meters daily, roughly 20% of its capacity. What could be Europe's biggest energy crisis in a generation has already prompted German regulators to advise that the bloc's largest economy must cut its natural gas use by 20% to protect themselves against any further supply cuts by Russia. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 18, 2022 (edited) https://oilprice.com/Energy/Energy-General/How-High-Will-European-Gas-Prices-Go.html The price cap rise comes largely as a result of the skyrocketing cost of Natural Gas; Image 1 below shows Dutch TTF Gas Prices, the European benchmark, over the past 12 months. The price rally over the Winter and major price shock following Russia’s invasion of Ukraine immediately stand out, although the more recent rise is the most concerning for households across Europe. The price has jumped from €47.99/MWH on August 16th, 2021 to now stand at €220.11/MWH, and this article will look at a few of the key driving factors behind this climb which has led to the gas crisis in Europe. Image 1; TTF Gas prices over the past 12 months Image 2: ChAI’s 12 month average forecasts for TTF prices (16/08/22) Edited August 18, 2022 by Tom Nolan 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 18, 2022 Natural Gas Demand Outpaces Production By Charles Kennedy - Aug 17, 2022, 11:00 AM CDT Major consuming nations are using more natural gas while production in 2022 remained flat compared to 2021 levels. U.S. natural gas production has been rising in recent months alongside LNG exports. Russian gas production has plummeted since the start of the Ukraine war. https://oilprice.com/Energy/Natural-Gas/Natural-Gas-Demand-Outpaces-Production.html 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 19, 2022 August 19th AM - By Phil Carr https://www.fxempire.com/forecasts/article/global-energy-prices-set-for-their-biggest-gain-on-record-whats-next-1101410 EXCERPTS: ...U.S Natural Gas prices skyrocketed above $9.65 (BTU) to levels not seen in over 14 years – notching up a staggering gain of over 525% – from this time two years ago when COVID-19 shutdown, the U.S economy. Elsewhere in the Energies complex, the real star performer this week was European Natural Gas. European Natural Gas prices have been on an unstoppable run – heading for the longest stretch of weekly gains since mid-December. This week, the European benchmark soared to a record high of €251 per megawatt hour – racking up a phenomenal gain of more than 700%, from this time last year. Put another way, that’s the equivalent of both benchmark futures contracts now trading at more than $400 a barrel of Oil. The summer spike in Natural Gas prices is being driven in part by high demand as scorching heatwave temperatures through much of the world force businesses and households to crank up the air conditioning. That in turn has chipped away at relatively low inventory levels. Prices are currently 11 times higher than where they usually are for the time of the year – and we haven’t even entered the winter months yet, when prices will enviably surge higher again. 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 19, 2022 https://oilprice.com/Latest-Energy-News/World-News/US-Natural-Gas-Storage-Sees-Minimal-Injection-as-Exports-Rise.html U.S. Natural Gas Storage Sees Minimal Injection as Exports Rise By Charles Kennedy - Aug 18, 2022, 1:30 PM CDT Falling far short of market expectations, the United States added only 18 billion cubic feet into its natural gas inventories for the week ending August 12, the Energy Information Administration (EIA) noted in its weekly natural gas inventory report on Thursday. The low injection rate for the week, compared to expectations of around 30 Bcf, pushed natural gas futures up early on Thursday, according to Natural Gas Intelligence. Heading into the fall and winter, this is a comparatively low injection rate. During the same week last year, the inventories gained 46 Bcf. Recently, U.S. natural gas futures have been gaining significant ground at highs surpassing anything seen in well over a decade due to increased momentum in exports that could leave the country short of supplies. Earlier this week, Bloomberg reported that U.S. supplies are still more than 10% below normal levels for this time of year. Natural gas futures had slipped somewhat earlier in the week as traders calculated the supply was recovering, ahead of the EIA’s Thursday report. Overall, natural gas prices have remained highly volatile throughout the year. On Monday, U.S. natural gas futures slipped. On Tuesday, they surged 7%. On Wednesday, prices rose to fresh highs but closed with slight losses. On Thursday, at the time of writing, U.S. natural gas futures were trading up around 0.80%, shortly after the EIA’s inventory release. The EIA also noted on Thursday that natural gas exports from Texas into Mexico have increased significantly, based on the most recent data from May 2022. During May, exports from pipelines in West Texas heading to Mexico averaged 1.6 billion cubic feet per day. That is a record level and represents a 12% increase from January through May. Increases in exports for West Texas to Mexico have doubled since 2019. By Charles Kennedy for Oilprice.com More Top Reads From Oilprice.com: Oil Jumps On Massive Crude Inventory Draw Germany Lowers Gas Sales Tax To Ease Burden On Consumers Natural Gas Demand Outpaces Production 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 19, 2022 On an oil barrel equivalent basis, EU Nattie uis now trading at triple the US equivalent (which is also at its highest since 2008) https://www.zerohedge.com/geopolitical/eu-natgas-soars-record-high-gazprom-announces-new-halt-flows 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 21, 2022 https://oilprice.com/Energy/Natural-Gas/Europes-Gas-Price-Is-Now-Equivalent-To-410-Per-Barrel-Of-Oil.html YAHOO FINANCE https://finance.yahoo.com/news/europe-gas-price-now-equivalent-230000506.html Europe’s Gas Price Is Now Equivalent To $410 Per Barrel Of Oil By Tsvetana Paraskova - Aug 20, 2022, 6:00 PM CDT Heatwaves across the globe have weighed on natural gas supplies. Countries are bracing for natural gas shortages this winter. Natural gas prices across the globe are soaring, with European prices now trading at what would be an equivalent of $410 per barrel of crude oil. Join Our Community Heatwaves this summer and expected natural gas shortages this winter are driving gas prices higher and higher. Europe's benchmark gas prices surged by 14% in just three days to a fresh record-high, continuing the upward trend from recent weeks, as gas demand for power generation is high amid heatwaves and Russian pipeline supply remains at low levels, while the EU scrambles to fill gas storage ahead of the winter that would see energy and gas rationing, industries shutting down production, and households paying sky-high prices for heating and electricity. Europe is in the most precarious position, but natural gas prices are rallying in the United States and Asia, too. Gas demand for power is high, and production is flat in America, while major Asian buyers are back on the LNG market to secure supplies for the winter. As LNG is now a global commodity, benchmark gas and spot LNG prices are soaring all over the world. And they could jump even higher when the heating season approaches. Europe's Gas Price Is Now Equivalent To $410 A Barrel Oil Europe's benchmark gas prices at the Dutch TTF hub rallied 14% between Monday and Wednesday, jumping by 6% on Wednesday at a new record of $240 (236 euro) per megawatt-hour. Gas prices have already doubled since June, when Russia first reduced supply via Nord Stream, the key pipeline carrying gas to Europe's biggest economy, Germany. The European gas benchmark now trades at what would be an equivalent of $410 per barrel of crude oil, which highlights "the debilitating economic impact on the region," Ole Hansen, Head of Commodity Strategy at Saxo Bank, said this week. Such record gas prices are hitting industries in Germany and the rest of Europe, with companies announcing production halts or curtailments "until further notice" amid soaring energy costs. Industries have warned that reduced production and operations could lead to a collapse of supply and production chains. Governments are scrambling to secure enough gas for the winter while walking a tight rope between alleviating the cost burdens on households and avoiding an industrial collapse and a wave of bankrupt energy companies. As a result of the gas crunch and a heatwave constraining supply and output from other fuel sources, year-ahead electricity prices continue to soar in Europe, with German power prices, the European benchmark, jumping to over $508 (500 euro) per megawatt-hour on Tuesday—a new record. Despite faster storage builds than usual, Germany will only have enough natural gas to cover two and a half months of consumption this winter if Russia completely suspends deliveries, Klaus Müller, the president of Germany's energy regulator, told Bloomberg this week. "The burden of high gas and oil prices will actually mean that we are going to see some steep contraction in the European economies next year," Amrita Sen, director of research at Energy Aspects, told Bloomberg on Wednesday. U.S. Natural Gas Prices Rally, Too European prices are at record highs and at around seven times higher than U.S. benchmark prices. But the U.S. prices at Henry Hub have surged, too, to the highest they have been in 14 years. This is the result of flattish domestic production, strong gas demand from the power sector in heatwaves, and lower than normal stocks in storage, despite the outage at the Freeport LNG export terminal, which has made available more gas for domestic consumption. The Freeport LNG outage prompted a 39% decline in Henry Hub prices in June. But in July, higher-than-normal temperatures across much of the U.S. resulted in strong gas demand in the power sector, which absorbed much of the Freeport LNG-related surplus and kept natural gas inventories from rising faster, the EIA said last week. Moreover, natural gas price volatility reached an all-time high in Q1 2022, the EIA noted. Related: Erdogan To Meet With Putin: “We Don’t Want Another Chernobyl” Working natural gas stocks are 12% lower than the five-year average and 10% lower than last year at this time, according to the EIA. After a slump in early June due to the Freeport LNG force majeure, U.S. benchmark gas prices have rallied by 70% since the end of June, hitting this week their highest level since August 2008 at above $9.30 per million British thermal units (MMBtu). The European benchmark price in MMBtu equivalents is now nearly $70/MMBtu – roughly seven times higher than American benchmark prices. This wide price differential is expected to pull more LNG exports out of America to Europe, which are already at record highs as the EU looks to replace as much Russian pipeline gas as possible. Asian LNG Prices Also Soar Asian utilities are also back on the market to procure fuel for the winter, traders tell Bloomberg. Higher demand in northeast Asia sent spot LNG prices rallying to nearly $60/MMBtu—the highest level since the beginning of March when the Russian invasion of Ukraine drove up northeast Asian prices to a record high of over $80/MMBtu. With winter approaching, natural gas prices could see further upside as Russian supply remains low, LNG demand rises, and American producers are not rushing to ramp up production. Eventually, the high prices could spur a response from U.S. shale gas drillers on the supply side, while on the demand side, record prices could accelerate the destruction of demand and sink European economies. By Tsvetana Paraskova for Oilprice.com More Top Reads From Oilprice.com: Why Europe Didn’t Ramp Up Caspian Gas Imports Sooner U.S. Looks To Catch Up To Taiwan In Chip Production Nearly 50% Of Africa Has No Access To Power, Could Renewables Help? Latest articles from Tsvetana Europe’s Gas Price Is Now Equivalent To $410 Per Barrel Of Oil Published 20 August 2022 | viewed 8,213 times Heatwaves this summer and expected natural gas shortages this winter are driving gas prices higher and higher. Europe's benchmark gas prices surged by 14% in… Judge Deals Blow To Michigan's Attempt To Shut Down Line 5 Published 19 August 2022 | viewed 2,948 times A judge in Michigan has sided with pipeline operator Enbridge in a case that Michigan Governor Gretchen Whitmer pursues to have the Line 5 oil… Ukraine: Russia Plans To Switch Off Zaporizhzhya Nuclear Plant From Grid Published 19 August 2022 | viewed 3,409 times Russia, which controls the Zaporizhzhya nuclear plant in southeastern Ukraine, is preparing to disconnect the operating blocks of the plant from the power grid, Ukrainian… Middle East Producers Expect To Bank Additional $1.3 Trillion From Oil Exports Published 19 August 2022 | viewed 3,845 times The major oil exporting countries in the Middle East are expected to receive an additional $1.3 trillion from oil by 2026, thanks to high oil… Oil Dips As Fear Of Recession Prevails On Market Published 19 August 2022 | viewed 14,172 times After two days of gains, oil prices turned lower early on Friday, weighed down by lingering concerns about recession in major economies and a strong… Outage At Oil-fired Plant In Sweden Adds To Power Supply Issues Published 18 August 2022 | viewed 2,459 times An oil-fired power plant in southern Sweden owned by German energy giant Uniper suffered a failure early on Thursday when a boiler tripped, adding to… U.S. Refiners Undeterred By Recession Fears Published 18 August 2022 | viewed 3,210 times U.S. refiners are set to continue operating at high utilization levels in the third quarter, despite concerns that a slowdown in demand could be looming… Germany Lowers Gas Sales Tax To Ease Burden On Consumers Published 18 August 2022 | viewed 1,816 times Germany will reduce the sales tax on gas to ease the financial pressure on consumers who will be paying a gas levy from October as… 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 22, 2022 Monday August 22nd EU Natural Gas Natural gas futures linked to TTF, Europe's wholesale gas price, rose almost 20% to above €290 per megawatt hour, a new record high on renewed supply fears. Russia's Gazprom said it would cut flows through the Nord Stream pipeline to Germany for three days of maintenance at the end of August, exacerbating concerns about supplies and raising the risk of a recession if Russia's natural gas squeeze widens. The state-owned energy company Gazprom has already reduced flows through the Nord Stream pipeline to roughly 20% of its capacity, citing issues with turbines. On top of that, a historic drought triggered by an arid summer that set heat records across Europe threatens to halt energy shipments along the Rhine River while limiting hydroelectric and nuclear power production. https://tradingeconomics.com/commodity/eu-natural-gas 1 Quote Share this post Link to post Share on other sites
Ron Wagner + 710 August 23, 2022 On 8/21/2022 at 9:16 AM, Tom Nolan said: https://oilprice.com/Energy/Natural-Gas/Europes-Gas-Price-Is-Now-Equivalent-To-410-Per-Barrel-Of-Oil.html YAHOO FINANCE https://finance.yahoo.com/news/europe-gas-price-now-equivalent-230000506.html Europe’s Gas Price Is Now Equivalent To $410 Per Barrel Of Oil By Tsvetana Paraskova - Aug 20, 2022, 6:00 PM CDT Heatwaves across the globe have weighed on natural gas supplies. Countries are bracing for natural gas shortages this winter. Natural gas prices across the globe are soaring, with European prices now trading at what would be an equivalent of $410 per barrel of crude oil. Join Our Community Heatwaves this summer and expected natural gas shortages this winter are driving gas prices higher and higher. Europe's benchmark gas prices surged by 14% in just three days to a fresh record-high, continuing the upward trend from recent weeks, as gas demand for power generation is high amid heatwaves and Russian pipeline supply remains at low levels, while the EU scrambles to fill gas storage ahead of the winter that would see energy and gas rationing, industries shutting down production, and households paying sky-high prices for heating and electricity. Europe is in the most precarious position, but natural gas prices are rallying in the United States and Asia, too. Gas demand for power is high, and production is flat in America, while major Asian buyers are back on the LNG market to secure supplies for the winter. As LNG is now a global commodity, benchmark gas and spot LNG prices are soaring all over the world. And they could jump even higher when the heating season approaches. Europe's Gas Price Is Now Equivalent To $410 A Barrel Oil Europe's benchmark gas prices at the Dutch TTF hub rallied 14% between Monday and Wednesday, jumping by 6% on Wednesday at a new record of $240 (236 euro) per megawatt-hour. Gas prices have already doubled since June, when Russia first reduced supply via Nord Stream, the key pipeline carrying gas to Europe's biggest economy, Germany. The European gas benchmark now trades at what would be an equivalent of $410 per barrel of crude oil, which highlights "the debilitating economic impact on the region," Ole Hansen, Head of Commodity Strategy at Saxo Bank, said this week. Such record gas prices are hitting industries in Germany and the rest of Europe, with companies announcing production halts or curtailments "until further notice" amid soaring energy costs. Industries have warned that reduced production and operations could lead to a collapse of supply and production chains. Governments are scrambling to secure enough gas for the winter while walking a tight rope between alleviating the cost burdens on households and avoiding an industrial collapse and a wave of bankrupt energy companies. As a result of the gas crunch and a heatwave constraining supply and output from other fuel sources, year-ahead electricity prices continue to soar in Europe, with German power prices, the European benchmark, jumping to over $508 (500 euro) per megawatt-hour on Tuesday—a new record. Despite faster storage builds than usual, Germany will only have enough natural gas to cover two and a half months of consumption this winter if Russia completely suspends deliveries, Klaus Müller, the president of Germany's energy regulator, told Bloomberg this week. "The burden of high gas and oil prices will actually mean that we are going to see some steep contraction in the European economies next year," Amrita Sen, director of research at Energy Aspects, told Bloomberg on Wednesday. U.S. Natural Gas Prices Rally, Too European prices are at record highs and at around seven times higher than U.S. benchmark prices. But the U.S. prices at Henry Hub have surged, too, to the highest they have been in 14 years. This is the result of flattish domestic production, strong gas demand from the power sector in heatwaves, and lower than normal stocks in storage, despite the outage at the Freeport LNG export terminal, which has made available more gas for domestic consumption. The Freeport LNG outage prompted a 39% decline in Henry Hub prices in June. But in July, higher-than-normal temperatures across much of the U.S. resulted in strong gas demand in the power sector, which absorbed much of the Freeport LNG-related surplus and kept natural gas inventories from rising faster, the EIA said last week. Moreover, natural gas price volatility reached an all-time high in Q1 2022, the EIA noted. Related: Erdogan To Meet With Putin: “We Don’t Want Another Chernobyl” Working natural gas stocks are 12% lower than the five-year average and 10% lower than last year at this time, according to the EIA. After a slump in early June due to the Freeport LNG force majeure, U.S. benchmark gas prices have rallied by 70% since the end of June, hitting this week their highest level since August 2008 at above $9.30 per million British thermal units (MMBtu). The European benchmark price in MMBtu equivalents is now nearly $70/MMBtu – roughly seven times higher than American benchmark prices. This wide price differential is expected to pull more LNG exports out of America to Europe, which are already at record highs as the EU looks to replace as much Russian pipeline gas as possible. Asian LNG Prices Also Soar Asian utilities are also back on the market to procure fuel for the winter, traders tell Bloomberg. Higher demand in northeast Asia sent spot LNG prices rallying to nearly $60/MMBtu—the highest level since the beginning of March when the Russian invasion of Ukraine drove up northeast Asian prices to a record high of over $80/MMBtu. With winter approaching, natural gas prices could see further upside as Russian supply remains low, LNG demand rises, and American producers are not rushing to ramp up production. Eventually, the high prices could spur a response from U.S. shale gas drillers on the supply side, while on the demand side, record prices could accelerate the destruction of demand and sink European economies. By Tsvetana Paraskova for Oilprice.com More Top Reads From Oilprice.com: Why Europe Didn’t Ramp Up Caspian Gas Imports Sooner U.S. Looks To Catch Up To Taiwan In Chip Production Nearly 50% Of Africa Has No Access To Power, Could Renewables Help? Latest articles from Tsvetana Europe’s Gas Price Is Now Equivalent To $410 Per Barrel Of Oil Published 20 August 2022 | viewed 8,213 times Heatwaves this summer and expected natural gas shortages this winter are driving gas prices higher and higher. Europe's benchmark gas prices surged by 14% in… Judge Deals Blow To Michigan's Attempt To Shut Down Line 5 Published 19 August 2022 | viewed 2,948 times A judge in Michigan has sided with pipeline operator Enbridge in a case that Michigan Governor Gretchen Whitmer pursues to have the Line 5 oil… Ukraine: Russia Plans To Switch Off Zaporizhzhya Nuclear Plant From Grid Published 19 August 2022 | viewed 3,409 times Russia, which controls the Zaporizhzhya nuclear plant in southeastern Ukraine, is preparing to disconnect the operating blocks of the plant from the power grid, Ukrainian… Middle East Producers Expect To Bank Additional $1.3 Trillion From Oil Exports Published 19 August 2022 | viewed 3,845 times The major oil exporting countries in the Middle East are expected to receive an additional $1.3 trillion from oil by 2026, thanks to high oil… Oil Dips As Fear Of Recession Prevails On Market Published 19 August 2022 | viewed 14,172 times After two days of gains, oil prices turned lower early on Friday, weighed down by lingering concerns about recession in major economies and a strong… Outage At Oil-fired Plant In Sweden Adds To Power Supply Issues Published 18 August 2022 | viewed 2,459 times An oil-fired power plant in southern Sweden owned by German energy giant Uniper suffered a failure early on Thursday when a boiler tripped, adding to… U.S. Refiners Undeterred By Recession Fears Published 18 August 2022 | viewed 3,210 times U.S. refiners are set to continue operating at high utilization levels in the third quarter, despite concerns that a slowdown in demand could be looming… Germany Lowers Gas Sales Tax To Ease Burden On Consumers Published 18 August 2022 | viewed 1,816 times Germany will reduce the sales tax on gas to ease the financial pressure on consumers who will be paying a gas levy from October as… The problem will be mainly over in two to three years as natural gas and all other options are exploited as needed around the entire world. There is not shortage of natural gas in the ground or at sea. This is also a time for green energy, of all kinds, can try to prove it can help at a good price. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 23, 2022 https://finance.yahoo.com/news/u-natural-gas-jumps-10-132000090.html U.S. Natural Gas Jumps To $10 For The First Time Since 2008 https://oilprice.com/Energy/Natural-Gas/US-Natural-Gas-Jumps-To-10-For-The-First-Time-Since-2008.html U.S. Natural Gas Jumps To $10 For The First Time Since 2008 By Tsvetana Paraskova - Aug 23, 2022, 8:20 AM CDT U.S. natural gas futures jumped briefly above $10 per MMBtu on Tuesday morning. U.S. natural gas prices have soared in recent weeks as Europe scours the world for non-Russian gas supply. Henry Hub gas prices have rallied by 70% since the end of June Join Our Community U.S. natural gas futures hit $10 per million British thermal units (MMBtu) early on Tuesday, jumping briefly above that threshold for the first time since 2008 as the energy crisis in Europe is worsening, and EU gas prices surged to another record today. As of 8:43 a.m. ET, the front-month U.S. benchmark natural gas price at Henry Hub was up by 0.60% at $9.737/MMBtu, having hit $10/MMBtu earlier in the day. U.S. natural gas prices have soared in recent weeks as Europe scours the world for non-Russian gas supply—mostly U.S. LNG—to fill gas storage sites in time for the winter heating season. After a slump in early June due to the Freeport LNG force majeure, U.S. benchmark gas prices have rallied by 70% since the end of June, hitting last week their highest level since August 2008 at above $9.30/MMBtu. This week, the prices exceeded $10/MMBtu as Europe braces for another halt of Russian gas deliveries via the Nord Stream pipeline to Germany for three days between August 31 and September 2. Germany and other EU countries are concerned that supply via Nord Stream—now at just 20% of the pipeline capacity—would be further cut or completely halted. U.S. gas prices are rallying, but it’s nothing compared to the surge in Europe’s gas prices, which set another record on Tuesday, beating Monday’s record-high price. Europe’s benchmark gas prices at the Dutch TTF hub soared by another 13% overnight to close to $297.55 (300 euro) per megawatt-hour, a fresh record high. The price has now doubled in just one month and currently sits 14 times higher than the average for the last decade, according to Reuters estimates. The much higher gas prices in Europe, at around ten times higher than the U.S. benchmark in MMBtu terms, are set to pull more LNG exports from the U.S. to Europe, potentially further stoking the rally in U.S. natural gas prices. In addition, the U.S. domestic market offers bullish catalysts for local gas prices as domestic production remains flattish, gas demand from the power sector is strong in heatwaves, and stocks in storage are lower than normal, despite the outage at Freeport LNG, which has made available more gas for domestic consumption. By Tsvetana Paraskova for Oilprice.com More Top Reads From Oilprice.com: Iran Starts Drilling At Oil Field Shared With Saudi Arabia U.S. Rig Count Stalls U.S. Strategic Petroleum Reserve Falls To 35-Year Low 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 23, 2022 Canada Studies Direct LNG Exports To Europe By Tsvetana Paraskova - Aug 23, 2022, 12:00 PM CDT Canada studies the feasibility of direct LNG exports to Germany. Trudeau: “we will do what we can to contribute to the global supply of energy.” In the short term, Canada cannot really help Europe with LNG supply as it doesn’t have any operational LNG export facility yet. https://oilprice.com/Energy/Natural-Gas/Canada-Studies-Direct-LNG-Exports-To-Europe.html Europe Gas Prices Break Records On Winter Crunch Fears By Irina Slav - Aug 23, 2022, 8:30 AM CDT Natural gas prices in Europe inched closer to 300 euro per megawatt-hour as fears deepened about a looming supply crunch during peak demand season. Bloomberg reported today that benchmark gas futures on the continent hit $288.81 (291 euro) per MWh in morning trade, after closing yesterday at a record high. https://oilprice.com/Latest-Energy-News/World-News/Europe-Gas-Prices-Break-Records-On-Winter-Crunch-Fears.html The World’s Biggest LNG Exporter Has A Pipeline Problem By Alex Kimani - Aug 22, 2022, 6:00 PM CDT The energy crisis in Europe has helped the United States position itself as the world’s largest LNG exporter. The United States, as the world’s biggest LNG exporter, also has the world’s largest backlog of near-shovel-ready liquefied natural gas projects. Limited pipeline capacity remains the biggest hurdle to expanding the sector. https://oilprice.com/Energy/Energy-General/The-Worlds-Biggest-LNG-Exporter-Has-A-Pipeline-Problem.html 1 Quote Share this post Link to post Share on other sites
Ron Wagner + 710 August 23, 2022 15 hours ago, Ron Wagner said: The problem will be mainly over in two to three years as natural gas and all other options are exploited as needed around the entire world. There is not shortage of natural gas in the ground or at sea. This is also a time for green energy, of all kinds, can try to prove it can help at a good price. I will be posting more news on new finds of natural gas. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 23, 2022 US NatGas Slides From 2008 Highs After Restart Delay At Freeport by Tyler Durden Tuesday, Aug 23, 2022 - 01:20 PM US natural gas prices plunged from the highest level since the 2008 commodity boom after news that a key LNG export terminal in Texas would delay restarting for another month. The Freeport plant, which closed in June due to an explosion, was initially slated to begin exports in October. The company released a statement Tuesday afternoon specifying the restart date will now be pushed to mid-November. The restart delay means more NatGas supplies for the US and less for Europe. The facility accounted for 20% of all US LNG exports. Following the news, US Natgas tumbled more than 5% to $9.18/mmbtu after topping $10/mmbtu earlier in the session (the highest level since 2008). Inversely, EU Natgas should move higher as this would mean fewer LNG carriers for the energy-stricken continent. The spread between EU and US NatGas is now at a record and should continue to widen after this news. Continued elevated EU Natgas prices suggest European power plants could switch to crude this winter - which will put a bid under oil prices. The Natgas market has watched Freeport's restart timeline very closely because it supplies tremendous amounts of LNG to Europe. The invasion of Ukraine exacerbated a NatGas supply crunch in Europe. In the first four months of this year, the US has sent nearly 75% of LNG exports to Europe. US Natgas prices have been rising as production slowdowns have spooked traders into believing winter storage levels might not be adequate. https://www.zerohedge.com/commodities/us-natgas-slides-2008-levels-after-restart-delay-freeport 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 24, 2022 Key Insights Natural gas markets have calmed down after yesterday’s sell-off. Freeport LNG will not work until late November, so European natural gas markets are gaining ground at the opening. Natural gas is stuck in a wide trading range, and the risks of a downside breakout are increasing. Freeport LNG Restart Is Delayed Until Late November Natural gas prices have stabilized near $9.35 as traders evaluate the recent news from Freeport LNG. The LNG producer stated that it would return 85% of the production by late November. Full production levels are expected to be achieved by March 2023. Previously, traders expected that Freeport LNG would resume partial operations in October. The news is bearish for the domestic market as more natural gas will stay inside the country instead of being exported. By:Vladimir Zernov Published: Aug 24, 2022 https://www.fxempire.com/forecasts/article/natural-gas-price-stabilizes-as-european-markets-rally-at-the-opening-1104908 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 24, 2022 Short-Term Recap: The Anatomy of a Trade Since August 8, October natural gas futures have been driven higher by worries over supply in Europe. At the bottom, the market was net short, but as the market climbed, the shorts were forced to cover their positions. U.S. traders weren’t actually getting aggressively long as the market climbed from $7.536, they were liquidating their short positions. When Russia announced a maintenance shutdown of a key pipeline in Germany, European gas prices spiked higher, and speculative buyers took out a few more shorts until the U.S. market ran into resistance as it approached the $10 level. Essentially, the market reached a top when the last of the weaker shorts was taken out of the market. Short-Sellers Regain Control However, Tuesday’s top was formed by more than just renewed short-selling. Traders were also reluctant to chase the U.S. market higher because of worries over more seasonal temperatures, rising production and, most importantly, the news of a further delay in the resumption of initial operations at the Freeport LNG export facility in Texas. According to reports, Freeport LNG said it expects partial recovery to begin in early to mid-November, not October as originally estimated. The company said it expects to ramp up to sustain 2 billion cubic feet per day production by the end of November. Short-Term Outlook In my opinion, the October natural gas futures market turned short-term bearish on Tuesday with the formation of a closing price reversal top at $9.987. Technically, the main trend will change to down on the daily chart if sellers take out $8.860. The first objective of this initial sell-off is $7.669 to $7.121. Fundamentally, the shifting of the resumption of the Freeport plant from October to late November changed the supply game. Producers now have an extra month to refill the storage bins which will help close the gap between current levels and the 5-year average. And the gap could be filled rather quickly because production is expected to increase and more favorable weather conditions will lead to lower demand as the summer cooling season comes to an end and the cooler “shoulder season” begins. So barring an earlier-than-expected winter, there is going to be a lot more natural gas available at the start of the winter heating season than there is today. Our outlook is bearish over the short-run, but the longer-term bull market is expected to remain intact at this time. This suggests there will be another buying opportunity once the market re-establishes new support. For a look at all of today’s economic events, check out our economic calendar. By: James Hyerczyk Updated: Aug 23, 2022, https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-us-market-turns-bearish-on-delay-of-freeport-lng-plant-restart-1102556 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 25, 2022 https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-us-prices-remain-elevated-ahead-of-eia-storage-report-1106408 AM August 25, 2022 Natural Gas Price Fundamental Daily Forecast – US Prices Remain Elevated Ahead of EIA Storage Report By:James Hyerczyk U.S. prices continue to be supported at multi-year levels due to high global gas rates, with contracts at $80 mmBtu in Europe and $56 mmBtu in Asia U.S. natural gas futures are edging lower on Thursday but remain buoyed by elevated gas prices in Asia and Europe. Domestic prices are being capped, however, by a delay in the restart of the Freeport export hub. Traders are now awaiting storage data from the government that will reveal the size of domestic supply shortfall. At 10:01 GMT, October natural gas futures are trading $9.208, down $0.092 or -0.99%. On Wednesday, the United States Natural Gas Fund ETF (UNG) settled at $31.86, down $0.15 or -0.47%. US Traders Being Guided by Elevated International Gas Rates U.S. natural gas prices are currently trading lower for the week after reaching a 14-year high at $10 per mmBtu on Tuesday. Nonetheless, U.S. prices continue to be underpinned at multi-year levels due to elevated global gas rates, with contracts at $80 mmBtu in Europe and $56 mmBtu in Asia. Heightened Volatility Remains the Theme U.S. prices surged earlier this week after Russian state energy giant Gasprom said last week the country would halt natural gas supplies to Europe for three days at the end of the month via its main pipeline into the region. The news spiked U.S. prices to $10 mmBtu on Tuesday, but prices quickly plunged after Freeport LNG announced its Texas plant would not return to operation until the end of November instead of the originally announced October deadline. The Russian pipeline news is expected to remain a major source of volatility into at least early September because Gazprom cannot guarantee that the problem with delivery will be fixed in a timely manner. Volatility could also be felt in the U.S. because the delay in bringing Freeport back from the outage could reduce the current projected shortfall in storage levels from 300 bcf to 250 bcf. The reduction in the shortfall could put significant downside pressure on U.S. natural gas futures. Daily Forecast Momentum may be shifting to the downside in the October natural gas futures market but this doesn’t mean the long-term bullish trend is changing. There may be some price adjusting to the downside, but not enough to change the long-term trend to down. It’s more likely to be treated as a buying opportunity in keeping with this year’s “buy the dip” theme. Although today’s U.S. Energy Information Administration’s (EIA) weekly storage report is expected to come in above-average and perhaps ease some worries about a supply shortage in the winter, reports of sluggish production are expected to keep prices supported. Ahead of today’s EIA storage report, due to be released at 14:30 GMT, Natural Gas Intelligence is reporting that a Reuters poll predicts a range of injections of 17 to 67 Bcf, with a median forecast of 60 Bcf. A Bloomberg survey had a slightly tighter range of estimates, with a median of 54 Bcf. For a look at all of today’s economic events, check out our economic calendar. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 25, 2022 EU Natural Gas Natural gas futures linked to TTF, Europe's wholesale gas price, were trading around €300 per megawatt hour amid persistent supply fears. Russia's Gazprom said it would cut flows through the Nord Stream pipeline to Germany for three days of maintenance at the end of August, exacerbating concerns about supplies and raising the risk of a recession if Russia's natural gas squeeze widens. The state-owned energy company Gazprom has already reduced flows through the Nord Stream pipeline to roughly 20% of its capacity, citing issues with turbines. On top of that, exports from two of Caspian Pipeline Consortium's three mooring points at a Black Sea terminal have been halted, according to the company, citing a damaged pipeline as the cause. Adding to the bullish outlook, a historic drought triggered by an arid summer that set heat records across Europe threatens to end energy shipments along the Rhine River while limiting hydroelectric and nuclear power production. https://tradingeconomics.com/commodity/eu-natural-gas 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 25, 2022 EXCERPT ...U.S. gas, liquefied and transported to the LNG import terminals in Europe, has been instrumental in filling up Europe’s gas storage caverns ahead of schedule. At the same time, it has highlighted Europe’s vulnerability in the gas supply department: it has virtually no alternatives to U.S. gas, and this has pushed its gas bill ten times higher than what European countries normally spend on gas. The vulnerability was also highlighted by the production outage at Freeport LNG, which supplies about a fifth of U.S. LNG and which has now said it will not restart production before November. Prices continue higher. “Virtually all of our fundamental and technical indicators continue to flash green lights toward higher price levels,” Ritterbusch & Associates said in a note cited by the Wall Street Journal earlier this week. The trading firm also said that U.S. natural gas prices could climb further up as well, close to $12 per million British thermal units in the not-too-distant future..... FROM: Climbing Natural Gas Prices Could Force U.S. To Slash Exports To Europe By Irina Slav - Aug 24, 2022, 4:00 PM CDT The United States has emerged as a top natural gas supplier to Europe. High domestic prices could force the United States to curb exports. If imports from the United States slowed, Europe’s energy crisis could worsen. https://oilprice.com/Energy/Gas-Prices/Climbing-Natural-Gas-Prices-Could-Force-US-To-Slash-Exports-To-Europe.html 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 25, 2022 EXCERPT Europe’s benchmark power price now trades at the equivalent of $1,101 a barrel crude oil, while the price of benchmark natural gas would be $518 per barrel in crude oil, according to Bloomberg’s estimates. By Tsvetana Paraskova for Oilprice.com Europe’s $280 Billion Support Package Could Make Energy Crisis Worse By Tsvetana Paraskova - Aug 25, 2022, 12:30 PM CDT https://oilprice.com/Latest-Energy-News/World-News/Europes-280-Billion-Support-Package-Could-Make-Energy-Crisis-Worse.html 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN August 30, 2022 https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-bullish-traders-playing-for-dip-into-value-area-1109038 Natural Gas Price Fundamental Daily Forecast – Bullish Traders Playing for Dip into Value Area By:James Hyerczyk Updated: Aug 30, 2022, Natural gas is expected to be underpinned over the near-term because the balance of price risks for gas on a seasonal basis remains high. Natural gas futures are edging lower on Tuesday after a volatile, but slightly better start to the new week. This type of early price action usually suggests a possible shift in the overnight weather forecasts, but since most of that knowledge is controlled by the insiders, we’ll have to wait until perhaps the regular U.S. opening before we’ll know for sure. The price action also suggests traders are reluctant to chase the market higher at current price levels, and may be waiting for a pullback into a value area. At 07:34 GMT, October natural gas futures are trading $9.229, down $0.107 or -1.15%. On Monday, the United States Natural Gas Fund ETF (UNG) settled at $31.97, down $0.02 or -0.06%. On Monday, traders were whip-sawed by the September natural gas futures contract expiration and weather models showing surges of heat over the next 1 to 2 weeks. Additionally, “spot gases were also mostly higher on Monday, with West Coast markets netting the most significant increases on yet another heat wave in the region,” according to Natural Gas Intelligence (NGI). Near-Term Weather Outlook Besides the September futures contract expiration, a change in the weather forecast over the weekend had traders on edge on Monday. According to NatGasWeather, cooler temperatures are expected to dominate in the coming weeks due to seasonal tendencies, however, one of its major weather models proved too much to ignore. The Global Forecast System (GFS) added a hefty 15 CDDs for the next 15 days, according to NatGasWeather. The European models also added a few CDDs to the outlook. Traders Monitoring Storage Deficit After the release of last week’s Energy Information Administration (EIA) report, supply stood 353 Bcf (12%) lower than the five-year average and 268 Bcf (9%) lower than last year at this time. Powerhouse Brokerage LLC noted that the average rate of injections into storage is 6% lower than the five-year average so far in the refill season, which runs through the end of October, NGI reported. If this rate of injections into storage matched the five-year average of 9.8 Bcf/d for the remainder of the refill season, total inventories would reach 3,292 Bcf on October 31. This would be 353 Bcf lower than the five-year average of 3,645 Bcf for that time of year. Short-Term Outlook Although we’re looking for a little weakness in the market over the short-run, the market is still expected to be underpinned because the balance of price risks for gas on a seasonal basis remains high, according to EBW. This would likely give traders a reason to buy the dips and shy away from aggressively shorting. Senior analyst Eli Rubin at EBW said, “If bullish catalysts can ignite upward momentum, substantial gains are possible later this fall.” For a look at all of today’s economic events, check out our economic calendar. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN September 1, 2022 https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-russia-begins-supply-squeeze-on-europe-1109048 Natural Gas Price Fundamental Daily Forecast – Russia Begins Supply Squeeze on Europe By:James Hyerczyk Updated: Aug 31, 2022, 09:02 CDT The biggest fear for market participants at this time is “what happens on September 3?” What if Russia delays the reopening of the pipeline? Natural gas futures are trading at a two-week low on Wednesday as U.S. traders take their cues from volatile European energy markets. Sellers appear to be gunning for support as they try to put a bearish spin on the market ahead of the new month. This is important price activity because it will give the market an indication of buying interest this late in the summer cooling season. Helping to drive the selling pressure are reports of strong production levels and weaker export volumes amid the deferred restart of the Freeport LNG terminal to November, according to NatGasWeather. At 13:37 GMT, October natural gas futures are trading $8.843, down $0.199 or -2.20%. The United States Natural Gas Fund ETF (UNG) is at $30.62, down $0.78 or -2.48%. Europe Storage Bins Filling Fast, Government’s Talking Price Caps Traders are anticipating heightened volatility over the short-run due to the wicked price action in Europe. NatGasWeather said that the greater-than-normal price swings particularly at the Dutch Title Transfer Facility are carrying over to the U.S. markets. Prices reached all-time highs last Friday at the DTTF, only to plummet on Monday and Tuesday. NatGasWeather attributed the pullback in European prices to a combination of “supplies refilling faster than expected” and “policy makers looking to cap energy prices.” Russia Begins Squeeze on Europe Russia halted gas supplies via Europe’s key supply route on Wednesday, intensifying an economic battle between Moscow and Brussels and raising the prospects of recession and energy rationing in some of the region’s richest countries. This news has been priced in for days. Russia’s plan is to shut down the Gasprom pipeline to Germany from August 31 to September 3. At least that’s what their saying. The biggest fear for market participants at this time is “what happens on September 3?” What if Russia delays the reopening of the pipeline? This is the major issue that could cause prices to skyrocket early next week. Daily Forecast Technically speaking, the main trend changed to down on the daily chart early Wednesday with the selling pressure stopping just above a short-term support area at $8.762 to $8.472. Today’s downside momentum suggests sellers are going to try to probe the support zone in an effort to see if there is any buying interest. That being said, we could see a technical bounce on the first test of $8.762 to $8.472. However, we’re not going to be completely convinced that the rally is still strong unless the buying is strong enough to take out $9.987. On the other hand, a drive through $8.472 will be a sign of weakness. If enough selling volume comes in on this move then we could see an acceleration to the downside with $7.669 to $7.121 the next major target. For a look at all of today’s economic events, check out our economic calendar. 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN September 1, 2022 https://finance.yahoo.com/news/u-natural-gas-power-generation-120000644.html https://oilprice.com/Energy/Energy-General/US-Natural-Gas-Power-Generation-Hits-Record-High-Despite-Soaring-Prices.html U.S. Natural Gas Power Generation Hits Record High Despite Soaring Prices By Charles Kennedy - Sep 01, 2022, 7:00 AM CDT U.S. natural gas consumption for power generation hit a record high in July, and demand for the energy source is only growing around the world. While natural gas prices in the U.S. are not near European levels, the U.S. benchmark is up by 146 percent over the past 12 months thanks to a hot summer and high exports. Normally, utilities switch to other sources when natural gas prices soar, but there was a lack of coal generation and it seems new renewable capacity isn’t coming online fast enough. Join Our Community Natural gas consumption for power generation in the United States hit a record high in July, spiking at 6.37 million megawatt-hours on July 21, just as legislators were discussing billions in investments in renewables. The reason for that spike was not enough coal generation, according to the Energy Information Administration. It’s interesting to note that the increase in gas-powered electricity generation in July happened despite higher gas prices, themselves the consequence of higher U.S. LNG exports to energy-starved Europe. U.S. benchmark gas prices are up by 146 percent over the past 12 months, inching closer and closer to $10 per million British thermal units. Yesterday, the front-month Henry Hub contract closed at $9.127 per mmBtu. The last time gas generation hit a record in the U.S. was the summer of 2020, when gas prices were quite low. When gas prices rise, utilities switch to other fuels, as a report by the American Public Power Association notes. Yet, when other fuels are in short supply, utilities are forced to stick with gas, it seems. The report makes no mention of wind, solar, and hydro, but it notes that the availability of coal generating capacity this summer was more limited than in previous years because of the ongoing retirement of coal plants. At the same time, the Financial Times reported this week that some U.S. utilities were delaying the retirement of their coal-fired plants to avoid supply outages because of “delays in obtaining cleaner replacements and strong electricity demand,” per the report. “While this is a difficult decision, it is necessary to maintain the reliable electricity service our communities have come to expect,” the chief executive of Omaha Public Power District, Javier Fernandez, told the FT. It seems new wind and solar installations are not coming online fast enough and, even in places with massive build-outs, they are not sufficient to provide the kind of reliable electricity service OPPD’s Fernandez told the FT about. Indeed, natural gas generation is far from out of favor in the U.S. Last year, the EIA reported there were 27.3 GW of planned new gas capacity to be completed between 2022 and 2025. The additions represent a 6-percent increase to 2021 capacity, which stood at 489.1 GW. Amid this stronger demand for natural gas, especially from abroad, U.S. shale oil drillers seem to be warming to natural gas once again, Reuters reported this week. While a few years ago they were ready to ship it for next to nothing because it was dirt cheap, now gas is turning into a precious commodity and production is rising. This month, gas output is seen reaching 93.84 billion cubic feet per day, up by some 6.715 billion cubic feet daily from a year ago. The Haynesville shale will lead with a 13.9-percent increase in production, followed by the Permian, with 7 percent, and Appalachia, where gas output is seen rising by 2.6 percent. Electricity consumption in the United States is expected to see a 2.4-percent overall increase over 2021 thanks to higher economic activity and a hot summer. Exports will also likely remain strong even though Europe has almost filled up its gas storage caverns ahead of winter. Demand for gas, both domestic and international, appears set for more gains in the coming months. This means that prices have further to go, especially if demand turns out higher than usual, which depends on the weather. The good news is that between them, natural gas and coal should minimize the risk of power outages in the United States in a way that they can’t in Europe because both gas and coal supply are tight. By Charles Kennedy for Oilprice.com More Top Reads From Oilprice.com: BP Looks To Restart The Midwest’s Largest Refinery LNG Prices Haven’t Hit A Ceiling Just Yet UK Household Energy Bills Will Triple On New Price Cap 1 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,443 TN September 1, 2022 https://oilprice.com/Latest-Energy-News/World-News/EU-Hits-Gas-Storage-Target-Ahead-Of-Deadline.html EU Hits Gas Storage Target Ahead Of Deadline By Irina Slav - Sep 01, 2022, 5:00 AM CDT The European Union’s gas storage facilities have been filled to 80 percent, the bloc’s Commissioner for Energy Kadri Simson said in a tweet. The EU had set itself a deadline in October to have its gas storage caverns 80 percent full ahead of the start of the heating season amid greatly weakened energy supply security and reduced Russian gas flows via the Nord Stream 1. Simson’s announcement follows a similar one made by European Commission President Ursula von der Leyen earlier this week, celebrating the achievement. However, it has come at a price and it will not ensure a sufficient supply for the European Union throughout the winter. U.S. liquefied natural gas imports were instrumental for the EU’s ability to fill up its storage earlier than its deadline but it has pushed the bloc’s gas bill ten times higher than what the EU normally pays for gas. Demand reduction is also on the agenda. Earlier this week, the head of Germany’s energy regulator Klaus Mueller said the European Union’s largest economy would need to reduce its gas consumption by at least a fifth in order to have a chance of getting through winter. Even if its gas storage caverns reach a fill level of 95 percent, it would not be enough for three months of consumption, Mueller said. According to the Bloomberg report about von der Leyen celebrating the early filling of gas storage caverns, the amount in them could only cover between 25 and 30 percent of gas consumption during the winter. “We will meet the goal before the heating season despite very difficult situation on the energy market, Gazprom’s dirty games around Nord Stream 1 and several member states being already completely cut off from Russian supplies,” Jerzy Buzek, a member of the European Parliament, told Bloomberg. “Full gas storages will certainly not solve all our current problems, but they do allow European citizens to feel more secure and confident before the coming winter.” By Irina Slav for Oilprice.com More Top Reads From Oilprice.com: BP Looks To Restart The Midwest’s Largest Refinery LNG Prices Haven’t Hit A Ceiling Just Yet UK Household Energy Bills Will Triple On New Price Cap 1 1 Quote Share this post Link to post Share on other sites
Most Active Members
Recently Online
Popular Members