Having rallied sharply month-to-date, natural gas futures eased lower through midday trading Tuesday as maintenance dinged daily export demand in updated estimates. West Texas physical prices, meanwhile, were climbing out of the negatives.
Here’s the latest:
- June Nymex futures off 3.0 cents to $2.351/MMBtu as of 2:22 p.m. ET
NatGasWeather on Tuesday attributed the slide in prices to profit taking in the wake of recent gains. Weaker export volumes may have also played a role, according to the firm.
Storage surpluses “remain hefty” and weather patterns were “slightly bearish” for the 15-day projection period, “although that hasn’t mattered much in recent weeks,” NatGasWeather added.
- Deliveries to U.S. LNG terminals dipping to 12.36 million Dth/d Tuesday, per NGI’s LNG Export Tracker
Overall flows to domestic liquefied natural gas export facilities hovered above 13 million Dth/d late last week and over the weekend. Freeport LNG was scheduled to receive more than 2 Bcf/d for Tuesday, continuing to suggest a recovery from the operational issues that hindered activities at the terminal earlier this year.
On the other hand, volumes bound for Cheniere Energy Inc.’s Sabine Pass terminal were down Tuesday, flow data show. A one-day maintenance on the Creole Trail Pipeline at the Gillis Compressor Station Tuesday was expected to hinder flows to Sabine, according to a recent note from Wood Mackenzie analyst Nadeem Ahmed.
- Ample storage buffer seen shrinking somewhat with this week’s inventory data
- NGI modeling a 75 Bcf injection for the week ending May 10
According to data from the U.S. Energy Information Administration (EIA), the five-year average injection for the period is 90 Bcf, with a year-earlier build of 93 Bcf. Total Lower 48 working gas in underground storage stood at 2,563 Bcf as of May 3, or 640 Bcf higher than the five-year average.
- Cash prices generally higher, with spot gas National Avg. up 13.0 cents to $1.595, per NGI’s MidDay Price Alert
- Waha back above zero, up $1.000 on the day to 10.5 cents
Spring pipeline maintenance continues to crimp associated gas volumes flowing out of the Permian Basin, though restrictions appear to have eased this week on Texas intrastates operated by Kinder Morgan Inc.
According to an electronic bulletin board notice, the Gulf Coast Express pipeline is scheduled to run at a reduced capacity of 1.86 Bcf/d through early next week, but that’s more than the 1.63 Bcf/d of capacity available during maintenance last month.
The Permian Highway Pipeline, meanwhile, is scheduled to flow 2.45 Bcf/d this week amid ongoing compressor station inspections, though that’s up from flows as low as 1.45 Bcf/d last week, according to a notice from the operator.
