"Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas

Tom Nolan · January 6, 2023

https://www.zerohedge.com/weather/us-natgas-prices-slide-18-month-low-warmer-temps-some-models-forecast-cold-blast-weeks

US NatGas Prices Slide To 18-Month Low On Warm Spell; Some Models Forecast Cold Blast In Weeks

by Tyler Durden

Friday, Jan 06, 2023 - 12:00 PM

See WEATHER MODELS in article

Tom Nolan · January 10, 2023

https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-ripe-for-short-covering-rally-due-to-oversold-conditions-1247562

Natural Gas Price Fundamental Daily Forecast – Ripe for Short-Covering Rally Due to Oversold Conditions

By:James Hyerczyk

Updated: Jan 9, 2023, 10:27 CST

With futures down about 44% over the past three weeks, natural gas futures start the new week in oversold territory.

Natural gas futures are edging higher on Monday, helped by oversold technical indicators and a surge in demand for crude oil. Hopes for less-aggressive U.S. interest rate hikes are also buoying financial markets and depressing the dollar. A weaker greenback makes dollar-denominated commodities like natural gas more affordable for investors holding foreign currencies.

At 12:40 GMT, March natural gas futures are trading $3.485, up $0.093 or +2.74%. On Friday, the United States Natural Gas Fund ETF (UNG) settled at $11.87, down $0.09 or -0.75%.

Natural Gas Starts Year with Biggest Weekly Dive in 31 Years

U.S. natural gas tumbled about 18% in the first week of January, the biggest slide on record to start a year, according to Refinitiv Eikon data.

“January 2023 is off to the warmest start in more than 15 years,” analysts at energy consulting firm EBW Analytics told customers in a note.

Will Oversold Conditions Offset the Widow Maker?

With futures down about 44% over the past three weeks, its biggest three-week drop in history, according to Refinitiv data, natural gas futures start the new week in oversold territory. The relative strength index (RSI) is below 30 for a seventh day in a row for the first time since 2019.

Meanwhile, the premium of futures for March over April, which the industry calls the widow maker, fell to a record low of 7 cents per mmBtu last Thursday as some in the market gave up hope that extreme cold would cause prices to spike later this winter.

The gas industry calls the March-April spread the “widow maker” because rapid price moves resulting from changing weather forecasts have knocked some speculators out of business.

The market uses the March-April spread to bet on the winter heating season when demand for gas peaks.

Given the oversold conditions, traders should watch this spread for any fast adjustments that could be indicating a bottom is forming.

Short-Term Outlook

We don’t expect to see a change in trend to up, but we could see a strong short-covering rally due to oversold conditions and stronger demand for dollar-denominated assets like natural gas due to the weaker greenback.

Furthermore, although the weather is expected to be quite warm over the next 15-days, there is a possible colder pattern forming. According to the European model, a colder pattern could form around Feb. 3 – 10 if frosty air over Canada finally advances back into the United States.

It’s quite far out but should be monitored because any shifts toward cold could shake out some of the weaker shorts.

For a look at all of today’s economic events, check out our economic calendar.

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https://www.fxempire.com/forecasts/article/weekly-waves-9-january-2023-eur-usd-gbp-usd-and-natural-gas-1249331

Natural Gas Falls Down Quickly in Bearish Impulse

The natural gas chart has made a strong downtrend continuation – as we expected in our regular Elliott Wave updates on NGAS in 2022:

The NGAS chart’s downtrend is expected to be a wave 3 (green) because of the strong impulsive decline.
The wave 3 (green) could continue lower. A small retracement (blue arrow) could follow up with another bearish swing lower (red arrow) before the wave 3 (green) is finished.
Eventually once the wave 3 (green) is completed, a larger bullish correction should emerge within a wave 4 (green).
Usually waves 4 are complex and lengthy, but eventually a new push lower within the wave 5 (green) of wave C (pink) of a potential wave W (gray).

09.01.2023_NGAS.png?func=cover&q=70&widt

Tom Nolan · January 10, 2023

REUTERS Mon, January 9, 2023 at 9:36 AM CST

(Adds latest prices) Jan 9 (Reuters) - U.S. natural gas futures jumped about 5% on Monday on forecasts for slightly more heating demand next week than previously expected and as short sellers take profits after prices fell to a one-year low last week. "The February natural gas contract is rebounding ... on overdue profit-taking by shorts," analysts at energy consulting firm EBW Analytics told customers, noting gas futures fell to an intraday low of $3.52 per million British thermal units (mmBtu) on Friday, their lowest since July 2021. That continues last year's record volatility with the contract now up or down over 5% on three of the five trading days so far this year. Front-month gas futures for February delivery rose 20.0 cents, or 5.4%, to settle at $3.910 per mmBtu. On Friday, the contract closed at its lowest since Dec. 30, 2021. Monday's price increase pushed the gas contract out of technically oversold territory for the first time in eight days. But after posting its worst start to a year on record, U.S. gas futures were still down about 13% so far this year after rising 20% in 2022. Last week's price drop caused gas speculators to boost their net short futures and options positions on the New York Mercantile and Intercontinental Exchanges for a third week in a row to their highest since October 2022, according to the U.S. Commodity Futures Trading Commission's Commitments of Traders report. Traders said the market's biggest uncertainty remains when Freeport LNG will restart its liquefied natural gas (LNG) export plant in Texas. After several delays from October to November and then to December, Freeport expects the facility to return in the second half of January, pending regulatory approvals. Analysts have long said Freeport would likely return during the first or second quarter of 2023 because the company still has work to do to satisfy federal regulators, including training staff in new procedures, before restarting the plant. Whenever Freeport returns, U.S. demand for gas will jump. The plant can turn about 2.1 billion cubic feet per day (bcfd) of gas into LNG, which is about 2% of U.S. daily production. Several vessels, including Prism Diversity, Prism Courage, Prism Agility and Elisa Larus, have been waiting in the Gulf of Mexico to pick up LNG from Freeport, some since early November. Other ships were sailing toward the plant, including Corcovado LNG, which is expected to arrive in mid-January, and Prism Brilliance, Kmarin Diamond and Wilforce expected in late January. U.S. GAS OUTPUT RISING Data provider Refinitiv said average gas output in the U.S. Lower 48 states rose to 98.3 bcfd so far in January, up from 96.7 bcfd in December. That compares with a monthly record of 99.9 bcfd in November 2022. With the weather expected to remain warmer-than-normal through late January, Refinitiv projected average U.S. gas demand, including exports, would ease from 121.2 bcfd this week to 120.7 bcfd next week. The forecast for this week was lower than Refinitiv's outlook on Friday, while its forecast for next week was higher. The average amount of gas flowing to U.S. LNG export plants rose to 12.1 bcfd so far in January, up from 11.9 bcfd in December. That compares with a monthly record of 12.9 bcfd in March 2022.

Tom Nolan · January 10, 2023

https://www.zerohedge.com/commodities/us-natgas-prices-bounce-after-monthlong-selloff-some-forecasters-see-cold-flip-end

US NatGas Prices Bounce After Monthlong Selloff; Some Forecasters See Possible Cold Flip End Of Month

by Tyler Durden

Monday, Jan 09, 2023 - 05:40 PM

US natural gas futures surged from an 18-month low and major support level. Energy prices as a whole rose on the prospects China's move to reopen would boost imports and outweigh global recession fears. Long-term weather models indicate the possibility of a return to winter for the Lower 48 later this month into next, while near-term outlooks still show mild temperatures. There's no concrete evidence yet of a flip from mild to colder temperatures for the US that would boost heating demand.

Front-month NatGas futures for February delivery jumped more than 10% to above $4 per million British thermal units (mmBtu). The snap higher in price (possibly a short squeeze) occurred just above the 76.4% Fibonacci retracement on the 2020 run-up from $1.43 to $10 in August. Since late last summer, prices have slid nearly 65% on abundant supply, mild winter, and LNG export troubles due to Freeport delays.

Comparing NOAA's latest 6-10 day weather outlook versus the 8-14 day outlook, there are signs cold weather could be ahead for the West Coast and Rocky Mountains while the eastern half of the US stays above average.

There's some chatter on social media about longer-term outlooks pointing to much colder weather for the Lower 48 later this month into next (remember, we pointed out some of these forecasts last week).

[MORE WEATHER MAPS]

...However, Houston-based energy firm Criterion Research said warmer trends would persist across the Lower 48 for the next two weeks. They also said there's a possibility of a weather event at the end of the month of early February...

...

...As for Freeport's restart, it's anyone's guess, but here's some commentary around the latest aerial drone photos of the LNG export facility and what one trader thinks the reopening timeframe could be in early March.

"This is my key (Not Skylar's). When the Valve that is under wrap is installed here. I estimate it is 6 weeks to restart away (pending they are smooth with regulators). That puts me smack at March 1st given work is happening now." #LNG #FreeportLNG #NatGas

Tom Nolan · January 10, 2023

https://oilprice.com/Energy/Natural-Gas/Europes-Warm-Winter-May-Not-Be-Such-Good-News-For-Energy.html

Europe’s Warm Winter May Not Be Such Good News For Energy

By Irina Slav - Jan 09, 2023, 5:00 PM CST

Winter in Europe has been so mild there has actually been an unseasonable increase in gas storage.
As long as the EU relies on LNG, these prices are not going to go much lower for the very simple reason that LNG could never be as cheap as pipeline gas.
Potential new summer demand for energy could make the task of European countries rushing to refill their gas storage a bit harder.

Join Our Community

The last month has been a month of celebration in the European Union. Gas demand is down because of the unusually warm weather. As a result, prices are down, and the crisis, according to analysts, appears to be averted. The problem is that some of those analysts are adding the qualifier “For now.” The European Commission boasted an over 20-percent decline in demand in gas consumption on the continent over the period between August and November last year. This was not just a result of warm weather but also concerted action by European governments to discourage more demand.

Then December turned out to be as warm as October, and demand fell naturally, as did prices. Some began talking about an end to the crisis and an end to the winter, even though in December, the astronomical winter was just beginning.

January is turning out to be warm so far, adding substance to predictions that Europe lucked out in a major way this winter and will finish it with enough of a gas cushion should another cold spell pay Europeans a visit.

In fact, winter has been so mild there has actually been an unseasonable increase in gas storage, Reuters’ John Kemp noted in a recent column. Only he also noted something else in that column. That the second factor leading to this unseasonable increase was the decline in industrial gas consumption. And the only way industrial consumers can reduce consumption is by shrinking their operations.

Related: Norway Replaces Russia As Germany’s Top Gas Supplier

This is the dark side of the success a lot of media are celebrating alongside Brussels. These celebrations appear to ignore the fact that the 20.1-percent decline in gas consumption across the bloc was also in no small part made possible by exorbitant gas prices that weighed on consumption the way excessive prices always weigh on the consumption of a commodity.

Then there is the fact that although gas prices are down from last summer’s peaks, they are nowhere near where they were in 2019. As Politico noted in a recent story about European gas demand and prices, at close to 70 euro per megawatt-hour, European benchmark gas prices were about five times what they were in 2019.

The problem that European politicians do not want to talk about is that as long as the EU relies on LNG, these prices are not going to go much lower for the very simple reason that LNG could never be as cheap as pipeline gas.

The other reason is that Russian pipeline deliveries are not returning any time soon, not along Nord Stream 1, anyway, and this means that the EU will continue to rely on LNG both by choice and by necessity for the observable future.

Over the short term, there’s some good news for Europeans. As wholesale prices on the TTF market fall, so will retail prices when they catch up with the wholesale prices—retail energy suppliers buy their gas on the wholesale market months in advance—and the winter may well continue mild. But that would likely mean a dry, hot summer, too. And that would increase the demand for energy for cooling purposes.

In fairness, Europe as a whole is a much smaller user of cooling technology than the United States, but that’s largely because it is, for the most part, a colder place. If this warm winter is any indication for this year’s summer, it will be a really hot one, pushing demand higher.

While unlikely to exceed traditional winter demand, this potential new summer demand for energy could make the task of European countries rushing to refill their gas storage a bit harder, even with gas left in storage from the previous heating season.

The goal for the next heating season will once again be 90-percent fill rates for all storage caverns across the bloc. Last year, there was plenty of LNG—at the respective price—with the EU turning into the world’s largest LNG importer in the world thanks to its sudden appetite for the superchilled replacement for Russian pipeline gas.

Yet this year, according to analysts, Europe would need to import even more LNG to secure its winter supply because there would be a lot less Russian pipeline gas than there was last year. One might hope for another warm winter but relying on hopes is hardly a sound energy security strategy.

The International Energy Agency has already warned the EU is facing a supply gap of 30 billion cu m of gas, even with all the demand destruction and deliberate demand cuts. And this gap might prove tricky to fill with China’s LNG appetite returning, too, as the country reopens, even with doubts about the success of this reopening still abounding.

It may, then, turn out that it is too early for the European Union to celebrate the warm winter, especially since it appears that warm or not, the weather is not having any positive effect on the EU’s emissions.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

Tom Nolan · January 10, 2023

https://oilprice.com/Latest-Energy-News/World-News/Biden-Administration-Considers-Banning-Gas-Stoves.html

Biden Administration Considers Banning Gas Stoves

By Irina Slav - Jan 10, 2023, 2:07 AM CST

The Biden administration may move to ban the use of gas stoves on the grounds of new research suggesting they may be related to health problems such as asthma.

The research, co-authored by officials from a clean energy nonprofit that also participate in a carbon-free buildings promotion program, suggested that more than 12 percent of asthma cases in children could be attributed to the use of gas stoves.

According to a Bloomberg report on the news, some 40 percent of American households use gas stoves but the U.S. Consumer Product Safety Commission may change that.

“This is a hidden hazard. Any option is on the table. Products that can’t be made safe can be banned,” one of the members of the commission, Richard Trumka Jr., told Bloomberg.

The report also cites information from the Environmental Protection Agency and the World Health Organisation, which says that gas stoves emit nitrogen dioxide, carbon monoxide, and fine particulate matter, which makes them unsafe.

A country-wide ban would follow similar bans set by several cities in the United States, including New York, Seattle and San Francisco. Bans in these cities cover things like gas furnaces and gas heaters, and California’s authorities are now moving to ban all gas-fired water heaters in the state.

According to the Consumer Product Safety Commissioner interviewed by Bloomberg, the ban on gas stoves could take the form of a suspension of imports of such appliances or a ban on their local manufacture.

Congressmen, meanwhile, have suggested the addition of warning labels, range hoods, and the introduction of higher performance standards, Bloomberg noted in its report.

People willing to switch from gas to electric stoves could take advantage of funding opportunities in the Inflation Reduction Act, which includes several hundred billion in spending on the transition from fossil fuels to clean electricity.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

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Some of the largest culprits of asthmas type conditions: "Synthetic Chemical Fragrances" and the adjuvant of aluminum in the bulk of childhood vaccines.

"Synthetic Chemical Fragrances" are designed to stay around (not degrade) and to cling to things and involve extremely toxic substances. The mechanism of the immune response when toxic aluminum is injected into the blood stream as an adjuvant explains many allergies and asthma and other health conditions. (The body does not use aluminum for any body function)

Tom Nolan · January 10, 2023

https://oilprice.com/Energy/Energy-General/Energy-Crisis-Makes-Europe-The-Worlds-Premium-LNG-Market.html

Energy Crisis Makes Europe The World’s Premium LNG Market

By Tsvetana Paraskova - Jan 09, 2023, 9:00 AM CST

In its rush to replace Russian natural gas, Europe imported nearly one-quarter of the liquified natural gas that was traded last year.
While Europe has enough natural gas to get through this winter, it will have to import even more LNG next year to survive the 2023/2024 winter.
LNG demand from Asia, particularly from China, was abnormally low this year but competition is expected to be more aggressive next year.

Tom Nolan · January 11, 2023

Wed 1/11/2023

US natural gas futures fell to $3.6/MMBtu, returning to levels not seen since December 2021, as gas output is again approaching record levels while forecasts for heating demand this week were revised down. Also, the Freeport LNG export plant in Texas, forced to go offline in June following a fire, again delayed the restart to the second half of January, leaving more supply on the domestic market. Furthermore, traders worry the plant will only be back online during the first or second quarter due to the need for further work to satisfy federal regulators.

https://tradingeconomics.com/commodity/natural-gas

European natural gas prices were at pre-Ukraine war levels of €70/MWh (66/MWh on Wed 1/11 am) in mid-January, down nearly 50% from their December peak and a fifth of records levels set in August, as warmer-than-expected temperatures eased concerns over shortages and the need for gas rationing. Yet, Europe is set for the warmest January in years. At the same time, record LNG imports, a rise in renewable capacity, namely from wind power in Germany, lower consumption and energy-saving measures helped to keep storages full. Gas storages across Europe hovered around 83% full in the last weeks, up from 50% a year ago and well above the five-year seasonal norm of 70%. Although the worst seems to be over for now, the outlook for 2023 remains challenging as a cold snap could raise heating demand. Also, Europe needs to increase its LNG import capacity and continue to attract LNG deliveries, at a time the Asian premium increased. Also, a rise in gas demand from China could increase competition in the LNG market.

https://tradingeconomics.com/commodity/eu-natural-gas

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Tuesday 1/10 am REUTERS

https://finance.yahoo.com/news/u-natgas-futures-fall-4-135920922.html

U.S. natgas futures fall 4% on rising output and lower demand forecast

Monday 1/9 PM

https://www.zerohedge.com/commodities/us-natgas-prices-bounce-after-monthlong-selloff-some-forecasters-see-cold-flip-end

US NatGas Prices Bounce After Monthlong Selloff; Some Forecasters See Possible Cold Flip End Of Month

Tom Nolan · January 11, 2023

https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-eia-sees-production-rising-to-record-high-in-2023-1251771

Natural Gas Price Fundamental Daily Forecast – EIA Sees Production Rising to Record High in 2023

By:James Hyerczyk

Published: Jan 11, 2023, 06:56 CST

The short-term outlook is bearish, but a short-covering rally is possible. However, gains will be limited because we are in “Sell the Rally” mode.

U.S. natural gas futures are edging higher on Wednesday after touching a multi-month low earlier in the session on rising output and forecasts calling for lower heating demand than previously expected for this week.

The small rebound could be reflecting a technical bounce due to oversold conditions, or profit-taking and position-squaring ahead of Thursday’s government storage report.

At 12:22 GMT, March natural gas futures are trading $3.357, up $0.043 or 1.30%. On Tuesday, the United States Natural Gas Fund ETF (UNG) settled at $11.42, down $1.01 or -8.13%.

Rystad Energy Analyst Highlights Bearish Conditions

“U.S. natural gas demand could be on track to hit record lows in January if seasonably warm weather sticks around,” Emily McClain, vice president at consulting firm Rystad Energy, said in a note.

“Despite consistently robust LNG (liquefied natural gas) demand … particularly from European buyers, prices are falling and expected to continue bearish momentum until winter weather returns,” McClain said, noting gas production has rebounded after a winter storm caused a sudden drop in late December.

Record US Production Growth to Keep Lid on 2023-2024 Gas Prices: EIA

U.S. natural gas production will rise to a record high in 2023, while demand will fall, the U.S. Energy Information Administration (EIA) said in its Short-Term Energy Outlook (STEO) on Tuesday.

EIA projected dry gas production will rise to 100.34 billion cubic feet per day (bcfd) in 2023 and 102.29 bcfd in 2024 from a record 98.02 bcfd in 2022.

The agency also projected gas consumption would fall to 86.74 bcfd in 2023 and 85.79 bcfd in 2024 from a record 88.72 bcfd in 2022.

The EIA’s latest projections for 2023 were lower than its December forecast of 100.38 bcfd for supply but higher than its December forecast of 85.40 bcfd for demand.

Short-Term Weather Forecast

According to NatGasWeather for Jan. 11-17, “Warmer than normal conditions will rule most of the central, southern, and eastern US with highs of 30s to 50s across the Great Lakes, Ohio Valley, and Northeast and nice upper 50s to 70s over the southern US and Mid-Atlantic Coast for very light national demand.

The West will be seasonal as weather systems track inland with rain, snow, and highs of 30s to 60s. The Northern Plains will be the nation’s only cold spot with highs of 20s-30s. Overall, low to very low national demand the next 7-days.”

Short-Term Outlook

Early estimates for the U.S. Energy Information Administration (EIA) storage print covering the week ended Jan. 6 ranged from a pull of 14 Bcf to an injection of 10 Bcf, according to Natural Gas Intelligence (NGI). NGI modeled a pull of 14 Bcf.

NGI also noted that even the withdrawal end of the range would compare meekly with the year-earlier EIA print of a 179 Bcf pull. The five-year average is a 151 Bcf draw. It would also stand in stark contrast to the close of 2022.

The short-term outlook is bearish, but we still could see a short-covering rally. Nonetheless, we expect gains to be limited because we are in “Sell the Rally” mode. It’s going to have to turn extremely cold to put even the smallest dent in this bear market.

For a look at all of today’s economic events, check out our economic calendar.

Tom Nolan · January 12, 2023

Wed, January 11, 2023 at 12:42 PM CST - Reuters https://finance.yahoo.com/news/1-u-natgas-falls-3-155454546.html

UPDATE 2-U.S. natgas edges up 1% with cold weather coming in late January

...as a growing number of analysts expect Freeport LNG to again delay the restart of its liquefied natural gas export plant in Texas. That continues last year's record volatility, with the contract now up or down more than 5% on four of the seven trading days in 2023. .

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https://finance.yahoo.com/news/freeport-lng-may-extend-texas-171116470.html..

Freeport LNG may extend Texas plant restart to February- sources

LONDON, Jan 11 (Reuters) - Top U.S. gas exporter, Freeport LNG, is expected to further extend the seven-month-long outage of its liquefied natural gas (LNG) export plant in Texas to February, as it awaits regulatory approvals, three sources told Reuters on Wednesday.

Accounting for 20% of U.S. LNG exports, resumption of the facility is important to ease the squeeze of global LNG supplies, especially as Europe is rebuilding its gas storage after Russia cut gas exports following Moscow's invasion of Ukraine.

"There has been no official messaging, but nobody expects any cargoes until end-February at the earliest," one of the sources said.

"Second half of January is now out of sight," another source said.

Freeport LNG spokeswoman said the restart timeline still stands and the company was still targeting the second half of this month for the safe, initial restart of its liquefaction facility, pending regulatory approvals.

The facility was initially expected to restart in October, but pushed back that target several times since the plant first closed on June 8 following a fire that a consultants' report determined was due to inadequate operating and testing procedures, and human error and fatigue.

In late December, the company said reconstruction work was substantially complete but regulators need to approve the restart, adding it did not anticipate the initial restart of its liquefaction facility to begin until the second half of January 2023.

The delays have forced big customers including JERA and Osaka Gas to book hundreds of millions of dollars of losses. Its other big offtakers include BP, TotalEnergies and SK E&S.

U.S. LNG exports have been steadily increasing for years and in 2022, the United States became the top supplier of LNG to Europe, where demand soared following Moscow's decision to largely cut off piped gas supply.

Both the U.S. Federal Energy Regulatory Commission (FERC) and the Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA) need to approve Freeport's return to service.

Many analysts do not expect the plant to return until the first or second quarter because the company still has a lot of work to do to satisfy regulators.

(Reporting by Marwa Rashad and Julia Payne in London; Additional reporting by Emily Chow in Singapore and Scott DiSavino in New York; Editing by Nina Chestney and Bernadette Baum)

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California Pounding Continues, But Upcoming Large-Scale Weather Pattern Change On The Way

https://www.zerohedge.com/weather/california-pounding-continues-upcoming-large-scale-pattern-change-way

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More Trading Online

Natgas Natural Gas Technical Analysis Today - Elliott Wave and Price News, Gas Price Prediction!

https://www.youtube.com/watch?v=47oPWm_hDOo

and on the 11th

https://www.youtube.com/watch?v=47oPWm_hDOo

Tom Nolan · January 13, 2023

https://finance.yahoo.com/news/1-u-natgas-jumps-6-153404547.html

Thu, January 12, 2023 at 9:34 AM CST Reuters

UPDATE 2-U.S. natgas up 1% on higher demand, despite surprise storage buildThu, January 12, 2023 at 9:34 AM CST·7 min read

(Adds latest prices, quote) Jan 12 (Reuters) - U.S. natural gas futures edged up about 1% on Thursday on forecasts for higher demand this week than previously expected, colder-than-normal weather coming in late January and uncertainty about when the Freeport liquefied natural gas (LNG) export plant in Texas will exit a seven-month outage. That small price increase came despite a federal report showing a surprise build in gas stockpiles that was the first injection during the month of January on record because the weather last week was warmer than normal, keeping heating demand low.

"With prices down so heavily to kick-off 2023, gas market players may have already largely priced in a considerably weak withdrawal," analysts at energy consulting firm Gelber & Associates said in a note. Gas futures were down about 17% so far this year.

The U.S. Energy Information Administration (EIA) said utilities added 11 billion cubic feet (bcf) of gas into storage during the week ended Jan. 6. That was a surprise from the 13-bcf withdrawal forecast by analysts in a Reuters poll and compares with a decrease of 157 bcf in the same week last year and a five-year (2017-2021) average decline of 157 bcf. Last week's increase boosted stockpiles to 2.902 trillion cubic feet (tcf), or 1.4% below the five-year average of 2.942 tcf for this time of year. Front-month gas futures for February delivery rose 2.4 cents, or 0.7%, to settle at $3.695 per million British thermal units (mmBtu). Earlier in the week, the contract closed at its lowest level since Dec. 30, 2021.

Despite the gain the contract remained in oversold territory with a relative strength index (RSI) below 30 for a third day in a row. Daily volume in the U.S. Natural Gas Fund, an exchange-traded fund (ETF) designed to track the daily price movement of gas, rose to 21.1 million shares on Wednesday, its highest since February 2022, according to Refinitiv data. That was the fifth most active day for the U.S. gas fund and follows a rise on Monday in shares outstanding to their highest since December 2020. Daily share purchases have entered the top 10 daily inflows three times already this year. Traders said the biggest market uncertainty remains the restart date for Freeport LNG's export plant in Texas.

After several delays from October to November and then to December, Freeport now expects the facility to be back in operation in the second half of January, pending regulatory approvals. Analysts, however, have long said Freeport, which shut in a fire on June 8, would probably return to service during the first or second quarter of 2023 because further work is required to satisfy federal regulators, including training staff in new safety procedures, before the plant can be restarted. A growing number of analysts and other sources have said this week that they do not expect Freeport back until February or later. Whenever Freeport returns, U.S. gas demand will jump. The plant can turn about 2.1 billion cubic feet per day (bcfd) of gas into LNG, which is about 2% of U.S. daily production. Several vessels, including Prism Diversity, Prism Courage and Prism Agility, were waiting in the Gulf of Mexico to pick up LNG from Freeport. Some have been there since early November. U.S. GAS OUTPUT RISING Data provider Refinitiv said that average gas output in the U.S. Lower 48 states has risen to 98.4 bcfd so far in January, up from 96.7 bcfd in December. That compares with a monthly record of 99.9 bcfd in November 2022. With the weather expected to remain warmer than normal until late January, Refinitiv projected average U.S. gas demand, including exports, would ease from 121.2 bcfd this week to 119.4 bcfd next week. The forecast for this week was higher than Refinitiv's outlook on Wednesday. Week ended Week ended Year ago Five-year Jan 6 Dec 30 Jan 6 average (Actual) (Actual) Jan 6 U.S. weekly natgas storage change (bcf): +11 -213 -157 -157 U.S. total natgas in storage (bcf): 2,902 2,891 3,042 2,942 U.S. total storage versus 5-year average -1.4% -6.7%

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Wed, January 11, 2023 at 11:23 AM CST https://finance.yahoo.com/news/freeport-lng-may-extend-texas-172328653.html

Freeport LNG may extend Texas plant restart to February- sources

LONDON (Reuters) - Top U.S. gas exporter, Freeport LNG, is expected to further extend the seven-month-long outage of its liquefied natural gas (LNG) export plant in Texas to February, as it awaits regulatory approvals, three sources told Reuters on Wednesday.

Accounting for 20% of U.S. LNG exports, resumption of the facility is important to ease the squeeze of global LNG supplies, especially as Europe is rebuilding its gas storage after Russia cut gas exports following Moscow's invasion of Ukraine.

"There has been no official messaging, but nobody expects any cargoes until end-February at the earliest," one of the sources said.

"Second half of January is now out of sight," another source said.