US natgas slips to 1-month low on ample storage as weather moderates

March 21 (Reuters) - U.S. natural gas futures slipped for a third straight session to their lowest in a month on Tuesday, weighed down by lower heating demand as weather moderates with sufficient inventory in storage. Front-month gas futures for April delivery traded 6.6 cents lower, or 3%, to $2.16 per million British thermal units (mmBtu) at 10:47 a.m. EDT (1447 GMT) after hitting a fresh low since Feb. 23 earlier. "We're seeing a combination of weather softening and lower feed gas into some of the LNG plants, which basically has us in a more surplus environment than we were just a few days ago," said Gary Cunningham, director of market research at Tradition Energy. "The weather forecast, if you go back two or three weeks, had shown a cold end to March and now those forecasts have revised warmer, which is less supportive to the market." Refinitiv forecast U.S. gas demand, including exports, would slide from 115.1 billion cubic feet per day (bcfd) this week to 108.3 bcfd next week. There are also concerns that the production is going to falter because of the low prices, said Phil Flynn, senior analyst at Price Futures Group in Chicago. Refinitiv said average gas output in the U.S. Lower 48 states rose to 98.7 bcfd so far in March from 98.2 bcfd in February. That compares with a monthly record of 99.9 bcfd in November 2022. Analysts said production declined earlier this year due in part to gas price declines of 40% in January and 35% in December that persuaded several energy firms to reduce the number of rigs they were using to drill for gas. In addition, extreme cold in early February and late December cut gas output by freezing some oil and gas wells in several producing basins. Milder winter weather this year has prompted utilities to leave more gas in storage than usual. Gas stockpiles were about 24% above their five-year average (2018-2022) during the week ended March 10 and were expected to end about 16% above normal during the colder-than-normal week ended March 17, according to federal data and analysts' estimates. "We still see significant price support further down the curve with Europe likely to be a strong buyer later in the summer amidst some tank topping ahead of the winter as Russian supply availability will be negligible in relation to past years," analysts at energy consulting firm Ritterbusch and Associates said in a note. "So, by and large, we still see some near-term price softening but will be looking to approach the long side by week's end depending upon the market's response to the EIA storage." Week ended Week ended Year ago Five-year Mar 17 Mar 10 Mar 17 average (Forecast) (Actual) Mar 17 U.S. weekly natgas storage change (bcf): -80 -58 -55 -45 U.S. total natgas in storage (bcf): 1,892 1,972 1,396 1,549 U.S. total storage versus 5-year average 16.3% 23.7% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2022 (2018-2022) Henry Hub 4.98 6.54 3.60 2.23 2.22 Title Transfer Facility (TTF) 41.81 40.50 14.39 11.61 11.87 Japan Korea Marker (JKM) 36.96 34.11 14.31 13.16 13.18 Refinitiv Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days Two-Week Total Forecast Current Day Prior Day Prior Year 10-Year 30-Year Norm Norm U.S. GFS HDDs 236 238 234 230 236 U.S. GFS CDDs 19 21 21 22 18 U.S. GFS TDDs 255 259 255 252 254 Refinitiv U.S. Weekly GFS Supply and Demand Forecasts Prior Week Current Next Week This Week Five-Year Week Last Year Average For Month U.S. Supply (bcfd) U.S. Lower 48 Dry Production 98.7 94.3 89.4 98.8 99.0 U.S. Imports from Canada 7.7 9.0 8.6 8.0 8.0 U.S. LNG Imports 0.0 0.0 0.1 0.0 0.0 Total U.S. Supply 106.4 103.3 99.1 106.7 107.0 U.S. Demand (bcfd) U.S. Exports to Canada 2.7 3.5 3.0 2.7 2.8 U.S. Exports to Mexico 5.6 5.5 5.2 5.4 5.3 U.S. LNG Exports 13.1 13.2 7.4 13.0 13.0 U.S. Commercial 14.0 10.1 12.4 13.2 11.0 U.S. Residential 22.3 14.3 19.6 20.8 17.0 U.S. Power Plant 30.4 24.1 25.7 28.9 29.3 U.S. Industrial 24.3 23.2 23.6 23.6 22.6 U.S. Plant Fuel 4.9 4.9 4.9 4.9 4.9 U.S. Pipe Distribution 2.6 2.5 2.6 2.5 2.3 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 98.5 79.2 88.9 94.0 87.2 Total U.S. Demand 120.0 101.4 104.5 115.1 108.3 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended Mar 24 Mar 17 Mar 10 Mar 3 Feb 24 Wind 15 12 13 15 14 Solar 3 3 3 3 3 Hydro 7 7 7 7 7 Other 2 2 2 2 2 Petroleum 0 0 0 0 0 Natural Gas 37 41 40 39 37 Coal 17 16 15 14 18 Nuclear 19 20 20 20 19 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 2.23 2.42 Transco Z6 New York 2.01 2.34 PG&E Citygate 9.50 6.94 Eastern Gas (old Dominion South) 1.91 2.18 Chicago Citygate 2.20 2.39 Algonquin Citygate 2.20 3.17 SoCal Citygate 14.85 8.00 Waha Hub 1.11 1.40 AECO 2.78 2.91 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 30.50 29.25 PJM West 30.75 28.50 Ercot North 16.75 39.50 Mid C 89.50 75.25 Palo Verde 86.00 45.50 SP-5 97.25 50.50 (Reporting by Deep Vakil and Swati Verma in Bengaluru Editing by Marguerita Choy)