Author Archives: Richard Meyer

Richard Meyer Natural Gas Market Indicators: July 15, 2014

As the northern hemisphere summer is half way through, perhaps it is a good time to take stock of where we are at.

On the supply front, production is as strong as it has ever been, with near record-breaking levels of dry gas produced at volumes more than 68 Bcf per day since June. Supplies directed toward storage have been similarly robust with a record setting eight straight weeks of 100+ Bcf injections since May. In other words, production is solid and supplies are rebuilding.

On the demand side, cooler summer temperatures compared with 2013 have eased power burn demand this July by nearly 2 Bcf. Industrial and residential-commercial demand are up slightly, as well as exports to Mexico. Therefore, the decline in July demand overall relative to last year is only 0.6 Bcf per day.

The result of this supply-demand balance is a natural gas price at Henry Hub of $4.11 per MMBtu – well below where the summer season began. This suggests that the market sees a sturdy supply portfolio that is able to meet both short-term demand pulls and seasonal storage obligations as operators refill for next winter. In other words, the market is behaving in an expected fashion.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Richard Meyer Natural Gas Market Indicators: June 27, 2014

The U.S. Energy Information Administration reminded us this month that the world’s first purpose-built, ocean-going LNG carrier, the Methane Princess, was placed into service 50 years ago in June 1964. That ship, and her sister vessel, the Methane Progress, traveled primarily between Algeria and the UK. Today, there are 357 such ships generally averaging five times the capacity of the original transporter.

Domestic production remains strong and growing, and storage injections’ aggressive poise has coincided with a slight softening of prices. Following one of the coldest winters in decades and the strongest demand pull ever, the physical market appears to be adjusting accordingly.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Richard Meyer Natural Gas Market Indicators: June 13, 2014

Natural gas pricing for July delivery has kicked around the $4.50 to $4.60 per MMBtu mark so far this June. The NYMEX strip shows natural gas prices at Henry Hub trading below $4.70 through this coming winter then falling near $4.10 by next year’s shoulder season.

Crude oil prices have climbed as summer in the northern hemisphere approaches. At $104 per barrel, the West Texas Intermediate marker for prompt-month delivery trades $3 higher than averaged in April. European Brent trades at $109 per barrel or a $4+ premium to WTI.

Relatively mild weather continues to persist across the lower 48 states, bringing with it strong injections of gas to storage. While temperatures in absolute terms have been relatively mild, the count of cooling degree days have been about 23 percent warmer than normal across the country. Regionally, the Northeast has been cooler than normal while the rest of the country has been warmer.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Richard Meyer Natural Gas Market Indicators: May 30, 2014

Total demand for natural gas during the first five months of this year is running about 3.2 percent ahead of that in 2013. This is led primarily by increased volumes to the residential/commercial sectors during the first quarter of the year.

Industrial consumption is also up slightly, recognizing that processes like ammonia production for fertilizer are serving as industrial sector growth opportunities with as many as 14 plants viable for construction between now and 2017, according to Bentek Energy LLC. Bentek believes that the load growth could be 900 MMcf per day if all 14 additions are completed.

Fertilizer demand is high and natural gas as a feedstock is moderately priced – a recipe for continued demand growth. Additionally, gas delivered into underground storage facilities is picking up speed with daily double digit injections uninterrupted since May 2.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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