Natural Gas End of Day Summary: Henry Hub Plummets

US Henry Hub front month losses have steepened as the day progresses, amid falling feedgas demand from LNG facilities, rising inventories, and signs of softer demand.

• US Natgas OCT 23 down -4.4% at 2.61$/mmbtu
• US Natgas MAR 24 down -1% at 3.2$/mmbtu
• The latest EIA weekly gas inventories for the week ending 15 Sep showed a build of +64bcf compared to a Bloomberg survey expecting a +64bcf build and the five-year average for this time of year of +89bcf.
• The surplus in total US inventories continues to trend slightly lower but stocks are still above the five year average at 3,269bcf compared to the average of 3,064bcf.
• Feedgas intake into Cheniere’s Sabine Pass LNG terminal in Louisiana dropped to its lowest level since Aug. 21, according to Bloomberg. Feedgas currently stands at 3.53 bcf/d, down 0.8 bcf/d compared to levels Sep. 20. Levels are down 18% from the recent five-day average of 4.31.
• Chevron today accepted a proposal that was put forward by Australia’s Fair Work Commission to end the dispute and ongoing strike action between Chevron and the unions. The unions can accept the proposal until Friday 09:00 Sydney time, otherwise both parties will need to attend the hearing scheduled with the regulator on Friday 10:00 Sydney time.
• Northeast US gas prices have remained below the gas-to-coal fuel-switching range through the summer but higher winter prices could incentivize higher coal usage according to BNEF.
• The Federal Energy Regulatory Commission approved the expansion of Sempra’s Port Arthur LNG facility according to Bloomberg.
• China's natural gas demand this year is expected to grow by 8% on the year to 396.4bcm, analyst, Xie Xuguang, at CNOOC's research division said.
• China may launch LNG futures trading for the first time later this year, Chinese brokerage Zhongtai Futures Co said.