Natural Gas Summary, UK, EU, USA... Week Ending 9-29-2023

The Energy Information Administration released their weekly report. 

At long last, all regions are above both last year and 5 year average. Hooray!

EIA.GOV via SNL Energy

Now for a look at The European Union and United Kingdom.

[The reason for this observation is LNG, which has introduced the prospect of U.S. Natural Gas prices being affected by global demand for LNG. The EU and UK serve as a benchmark for these demand issues.]

Time to wrap up the publishing of this weekly natural gas summary...

Review of August data and the September PCE Release

Yep, today's report was positive, with an uptick of +0.4%. That being in current dollars and when adjusted for inflation became... -0.2% for the month to month. The good news was the year to year inflation adjusted +0.1%. 

I did not denote the various changes from previous month's release, so but can be seen in previous publications.

It should be noted that multiple adjustments were made to previous readings, as indicated below...

The FED chain type report of PCE, excluding food and energy was adjusted to 2017 from previous 2012.

The 3.9% current, hearkens back to May of 2021, when things were transitory. The signs are pointing downward, but that 3.0% target remains distant, imho.

The scorecard for this month looks like this.

If I were grading this report, it would be 47.1%, compared to last month's 52.9%. Translation: My confidence in inflation heading towards 2.0% is not as great as some are predicting. 

Quick Review of The GDP report 2Q-2023, 3rd estimate

First off, the base year for chained dollars is now 2017, instead of the previous 2012.

Secondly, there were revisions in past quarters, or updates. This is done annually. 

• 2023 Quarter one GDP was revised upward, from 2.0% annualized, to 2.2% annualized.
• 2023 Quarter one GDI was revised upward from -1.8% annualized to 0.5% annualized.

There are other changes, but that was a sampling.

While the chained dollar report for last month, based on 2012, showed the Real GDP at 20.387T, the new report based on 2017, is now 22.225T. 

However, there were significant reductions in the report, with Durable Goods being reduced, both on the personal consumption level and imports. 

Clearly there were large adjustments elsewhere to overcome those changes, such as in personal consumption services (quite large), Fixed Investment and Government consumption and Net exports of goods and services.

Nothing really out of line from expectations, although the Personal Consumption Expenditures for Goods was quite a drop from Quarter one. However, it is still positive and the drop was not quite a surprise, as the Monthly PCE report has been screaming a sharp decline.

Natural Gas Summary, UK, EU, USA... Week Ending 9-22-2023

The Energy Information Administration released their weekly report.

The Pacific Region has pushed above year ago levels and is very near the 5 year average.

Now for a look at The European Union and United Kingdom.

[The reason for this observation is LNG, which has introduced the prospect of U.S. Natural Gas prices being affected by global demand for LNG. The EU and UK serve as a benchmark for these demand issues.]

Data from the Aggregated Gas Storage Inventory report...

The United Kingdom continues to slide in percent of storage filled. It should be noted that UK does have access to natural gas supplies and infrastructure for LNG. However, the flip side is more abrupt changes in pricing.

Which is most noticeable in the forward futures, as shown on this chart.

The US market continues to be somewhat stable. 

Natural Gas Summary, UK, EU, USA... Week Ending 9-15-2023

The Energy Information Administration released their weekly report.

The Pacific Region has pushed above year ago levels and is nearing the 5 year average.

EIA.GOV, via SNL Energy

Now for a look at The European Union and United Kingdom.

[The reason for this observation is LNG, which has introduced the prospect of U.S. Natural Gas prices being affected by global demand for LNG. The EU and UK serve as a benchmark for these demand issues.]

Data from the Aggregated Gas Storage Inventory report...

The overall EU pct. slipped since last week, but the volume in storage increased, as capacity increased.

While the EU as a whole, has approximately 100 days of supply, it should be noted that days supply varies greatly within the individual countries. 

Prices edged up in the EU and UK.

U.S. Henry Hub finished the week down -3¢.

Both TTF (Dutch) and UKG remain approximately double historical norms. Henry Hub is running about 2/3 of those norms. 

Natural Gas Summary... Week Ending 9-08-2023

The Energy Information Administration released their weekly report.

The Pacific Region continues to be slightly ahead of year ago numbers, but still below the 5 year average, although still improving.

The South Central Region continued the slide against year ago levels, but is still above 5 year average.

EIA.GOV, via SNL Energy

Now for a look at The European Union and United Kingdom.

[The reason for this observation is LNG, which has introduced the prospect of U.S. Natural Gas prices being affected by global demand for LNG. The EU and UK serve as a benchmark for these demand issues.]

Data from the Aggregated Gas Storage Inventory report...

Data per AGIS

The UK continues to reduce inventory, while Austria and Belgium slipped from last report.

Overall, NatGas prices slipped compared to last week.

EU & UK NatGas Inventory Report, September 01, 2023

Data from the Aggregated Gas Storage Inventory report...

While up in most areas of Europe, Austria -.01%, Czech Republic -.02%, and the UK down -1.63%.

Pricing finds the U.S. back to normal, with the EU and the UK still elevated, as will likely continue for quite a period of time.

U.S. NatGas Inventory Report, August 31, 2023

The Energy Information Administration released their weekly report today.

The Pacific Region is now slightly ahead of year ago numbers, but still below the 5 year average.

The South Central Region slipped below one year ago levels, but is still above 5 year average.

EIA.GOV, via SNL Energy

Nothing dramatic taking place, so steady as she goes, would be the best description, imho.

Review of July data and the August PCE Release

Some ups and some down in the latest release from the BEA. (red revised down, green revised up).

Chained dollar disposable income was revised down for April and June, with a negative print on July.

However, the chained dollar PCE was revised down for March and May, with upward revisions in April and June. 

It seems evident that savings AND debt are currently driving the economy. How long that can last is the big question.

Then there is the matter of PCE Excluding Food & Energy. If the target is 2%, then there is a way to go, given the forecast for August is at 4%. Years ago, when the PCE ex food and energy was failing to achieve even 2%, there was discussion of moving the target to 4%. 

That hasn't happened, so how can it be expected for the FED to ease off the interest rates? 

https://www.bea.gov/news/2023/personal-income-and-outlays-july-2023

We are now 28 months with the PCE ex food and energy above the 2% mark, and 17 months into the FED increasing rates. 10 months out, with the aforementioned halting its rise. 

The chart below indicates some problems still within the system. Last month had just one category in pink. 

We are at the end of August and its data will likely be similarly ugly. Let's hope for some relief in September. 

Quick Review of The GDP report 2Q-2023, 2nd estimate

The BEA released the 2nd estimate of 2Q-2023 GDP...

Real gross domestic product (GDP) increased at an annual rate of 2.1 percent in the second quarter of 2023 (table 1), according to the "second" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 2.0 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 2.4 percent (refer to "Updates to GDP"). The updated estimates primarily reflected downward revisions to private inventory investment and nonresidential fixed investment that were partly offset by an upward revision to state and local government spending.

Here is a screenshot of the data page... 

Probably the most interesting thing is the GDI of +0.5%, which is the first positive, since 3rd Quarter of 2022.

EU & UK NatGas Inventory Report, August 25, 2023

Data from the Aggregated Gas Storage Inventory report...

The storage continues to increase, and has surpassed same period of 2020.

Natural Gas prices moderated in both nearby and futures pricing, as the potential for a strike by Australian Unions at one LNG facility seemed to have abated. At least until another strike was threatened, which sent prices upward again... today.

While current prices in the EU and UK are below pricing of 2 years ago, they are still elevated compared to 2019 and 2020. Despite LNG exports, U.S. prices remain at 2019 and 2020 levels.

U.S. NatGas Inventory Report, August 24, 2023

The Energy Information Administration released their weekly report today.

The Pacific Region continued to gain inventory, although still below one year ago and 5 year average.

The South Central region shed inventory over the week, yet remains well above year ago and 5 year average.

EIA.GOV, via SNL Energy

Generally speaking, natural gas prices are significantly below one year ago levels, and more in line with pre-covid levels. 

Current price levels suggest consumer inflation in natgas as well as pass through products (electricity) will continue to moderate. These products represent about 3.6% of the average consumer basket.

EU & UK NatGas Inventory Report, August 18, 2023

 Data from the Aggregated Gas Storage Inventory report...

Much is being made of the 90% achievement, 3 months early. Typically this would represent about 3 months of supply, if all sources were cut off. That will not happen, but winter expectations and potential Australian LNG strike has provided apprehension in the markets. That potential for less supply has sent the bidding upward.

Overall, the price of TTF NatGas is still below levels of 2 years ago -(13.2%). That was before the pipeline chicanery, blackmail, etc. 

U.S. NatGas Inventory Report, August 18, 2023

The Energy Information Administration released their weekly report yesterday.

The Pacific Region continues to be below year ago and 5 year averages, although significant gains from last week.

Price changes in California were mixed this week. The price at PG&E Citygate in Northern California fell 7 cents, down from $5.71/MMBtu last Wednesday to $5.64/MMBtu yesterday. The price at SoCal Citygate in Southern California increased $2.85 from $4.95/MMBtu last Wednesday to $7.80/MMBtu yesterday. El Paso Natural Gas Company reported maintenance on the North Mainline near Leupp, Arizona, beginning on Monday August 14. In addition, ongoing maintenance is occurring at the SoCalGas pipeline system. Prices in the West remain the highest in the country as above-average temperatures keep demand for cooling high and as the Pacific region remains the only region in the United States with below-average storage levels.

 

Henry Hub prices fell from last week, as well as on the futures market.

Natural Gas Inventory Report, August 11, 2023

The Energy Information Administration released their weekly report yesterday.

The Pacific Region continues to be below year ago and 5 year levels, but is slowly gaining.

Prices increased in West Coast markets, still the highest priced markets in the United States, except in Southern California where a large maintenance event concluded. The price at Sumas on the Canada-Washington border rose 37 cents from $3.72/MMBtu last Wednesday to $4.09/MMBtu yesterday, and the price at PG&E Citygate in Northern California rose 54 cents, up from $5.17/MMBtu last Wednesday to $5.71/MMBtu yesterday. 

 Select EU and UK storage...

Inventories continue to improve across the EU and UK. (100% inventory capacity is approximately a 90 day supply.)

Dutch and UK futures, surged 6% and 7% respectively over last week. February, 2024 futures, surged nearly 22% from last week.

Henry Hub futures surged 7% almost across the board.

The upward pressure stems from labor action in Australia, increased LNG demand in Asia, as well as a Norwegian pipeline tapering down to closure in early fall. The labor action had been somewhat anticipated, and certainly the latter two... were on tap. Or as Rumsfeld might have said... the labor action was a known unknown, and the latter were known knowns. 

So something else might be shaking the market.

Natural Gas Inventory Report, July 28, 2023

The Energy Information Administration released their weekly report yesterday.

The Pacific Region slipped to -8.3% from last week's -7.9% last week's numbers, although year ago numbers edged up to -13.1% from -13.4%

Across much of the West, prices increased this week, particularly in California. In the Rocky Mountain region, the price at Cheyenne Hub in southeast Wyoming rose 16 cents from $2.24/MMBtu last Wednesday to $2.40/MMBtu yesterday. In California, the price at PG&E Citygate in Northern California rose 40 cents, up from $4.89/MMBtu last Wednesday to $5.29/MMBtu yesterday. The price at SoCal Citygate in Southern California increased $6.69 from $5.64/MMBtu last Wednesday to $12.33/MMBtu yesterday.

Ouch!!

 Select inventories of EU and UK... 

It should be noted that while percent of capacity is high... that capacity is generally only about a 3 month supply. It is much better than years past, but still dependent on weather and geo-politics.

Total EU rose to 84.49%, from last week's 82.53%.

Snapshot of the past, the current and the future outlook for prices.