[Editor’s note: This story was updated at 8:03 p.m. CT Oct. 12.]
U.S. natural gas futures spiked on Oct. 12 to their highest since March 2019 as the amount of gas flowing to LNG export plants jumps with units returning in Louisiana after Hurricane Delta and in Maryland after maintenance work.
Traders also noted prices were up on forecasts for colder weather and higher heating demand over the next two weeks and with output on track to drop to its lowest since July 2018 due mostly to well shut-ins for Delta.
Delta slammed into the Louisiana coast late Friday, causing over 878,000 customers to lose power. There were about 224,000 homes and businesses still without service the morning of Oct. 12, mostly in Louisiana.
Front-month gas futures rose 14.0 cents, or 5.1%, to settle at $2.881/MMBtu, their highest close since March 2019.
Data provider Refinitiv said output in the Lower 48 would slide from a 26-month low of 82.4 Bcf/d over the weekend to a preliminary 82 Bcf/d on Oct. 12 due to the Delta shut-ins.
The U.S. Bureau of Safety and Environmental Enforcement (BSEE) said energy firms started to return offshore production in the Gulf of Mexico. BSEE said that output was now curtailed by 1.3 Bcf/d, down from 1.7 Bcf/d on Oct. 11.
In Louisiana, the Cameron and Sabine Pass LNG export plants both took in more pipeline gas over the weekend and tankers started to return to Sabine. There is also at least one vessel waiting in the Gulf of Mexico to go to Cameron, according to Refinitiv data.
In Maryland, Dominion's Cove Point started to exit its three-week annual maintenance outage.
As LNG feedgas rises and the weather turns colder, Refinitiv projected average demand would jump from 84.6 Bcf/d this week to 94.8 Bcf/d next week. That is higher than Refinitiv's forecast on Oct. 9.
U.S. Natural Gas Storage (Bcf)
|Week ended Oct. 9
|Week ended Oct. 2
|Year ago Oct. 9||Five-year average
SNL U.S. Natural Gas
|Hub||Current Day||Prior Day|
|Transco Z6 New York||$0.52||$0.67|
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