Henry Hub Extends Drop on Healthy Near Term Supplies

Henry Hub front month us under pressure again today with a below estimated storage draw yesterday adding to strong domestic production and curtailed LNG exports.

• US Natgas MAR 24 down -0.9% at 2.03$/mmbtu
• US Natgas AUG 24 down -0.7% at 2.54$/mmbtu
• US Natgas FEB 25 down -0.6% at 3.6$/mmbtu
• The EIA weekly gas inventories for the week ending Jan 26 showed smaller than expected storage withdrawal -196bcf compared to the expectation for a draw of -208bcf according to a Bloomberg survey and the seasonal normal draw of -184bcf. The US inventories surplus has reduced in recent weeks, but total stocks remain above normal at 2,659bcf compared to the previous five year average of 2,546cf.
• Lower 48 natural gas demand remains below normal amid warm weather this week with today estimated near yesterday at 90.0bcf/d. The NOAA forecast is relatively unchanged for the coming two weeks with below normal temperatures expected in the west and above normal in the east in the 6-14 day period.

• US domestic gas production remains strong with today estimated at 104.7bcf/d according to Bloomberg compared to an average of 104.5bcf/d in the previous week.
• Feedgas supply to US LNG export terminals are today down further to 13.78bcf/d according to Bloomberg with a small dip in supply to Sabine Pass and Corpus Christi to add to the ongoing Freeport restrictions.
• Export flow to Mexico is today at 6.41bcf/d.