Prices fall modestly through the week at most locations. Prices at most market locations outside of the Northeast fell this week, generally by less than 10%. The Henry Hub spot price began the week at $2.99/MMBtu, fell through the week, and settled yesterday at $2.82/MMBtu. Prices at other major trading hubs moved in a similar pattern; the PG&E Citygate price, serving Northern California, fell from $3.34/MMBtu last Wednesday to $3.19/MMBtu yesterday. Prices at the Chicago Citygate fell from $3.01/MMBtu last Wednesday to close the week at $2.76/MMBtu yesterday.

 

Weather shifting from mild to warmer overall. Temperatures this week started out relatively mild, but warmed nationwide through the week. The cooler start held demand in check but the report week closed with warmer-than-normal temperatures in several regions, putting upward pressure on prices. EIA's Short-Term Energy Outlook, May 2015, expects prices to rise somewhat through the summer as demand picks up, but still remain relatively low.

Northeast prices mixed. Pricing for Transcontinental Pipeline's Zone 6, serving New York City, began the week at $2.59/MMBtu, dropped to below $2.00/MMBtu for the holiday weekend, before increasing to end the week at $2.86/MMBtu. At the Algonquin Citygate, which serves Boston, prices started the report week at $1.81/MMBtu, went lower with mild weather for the Memorial Day weekend to $1.62/MMBtu, but then rose 88¢ across Tuesday and Wednesday to close at $2.50/MMBtu yesterday. In general, Northeast pricing remained at or below the Henry Hub benchmark through the report week, though the Transco Zone 6 spot price, along with Tennessee Zone 6 200L (New York and New England) price, both rose higher than the Henry Hub price to close the week.

Marcellus prices fall. Marcellus-area prices fluctuated through the week, with trading points down at the close on Wednesday. At Tennessee's Zone 4 Marcellus location, prices fell from the starting point of $1.40/MMBtu on May 20 to $1.35/MMBtu yesterday. On the Transco Leidy Line, prices dropped from $1.56/MMBtu last Wednesday to $1.48/MMBtu yesterday, after dropping to $1.33/MMBtu on Friday. At Dominion South, which serves customers in portions of Pennsylvania, Ohio, Maryland, West Virginia, and Virginia, prices fell from $1.59/MMBtu a week ago to $1.55/MMBtu yesterday.

Nymex prices fall. The Nymex June 2015 contract started the report week at $2.915/MMBtu last Wednesday, falling to $2.815/MMBtu yesterday as it expired as the prompt month. The 12-month strip (the average of the 12 contracts between June 2015 and May 2016) fell from $3.120/MMBtu last Wednesday to $3.026/MMBtu yesterday.

Maintenance outages continue to slow production. Both scheduled and unscheduled maintenance occurred this week, which contributed to production levels falling 0.6%, according to Bentek Energy. Production in the Northeast was affected by the continued outage on Dominion's LN 280, located in Tioga County, Pennsylvania. Maintenance on that line concluded yesterday. Additional constraints were noted by Bentek Energy for the Southeast and Texas, where maintenance at the Mobil Bay processing plant in Alabama limited delivery to the Gulf South, Gulf Stream, and Transco pipelines. Additionally, Louisiana offshore production declined, likely caused by unplanned maintenance on the Discovery Pipeline located in the Gulf. Despite the drop in production this week, production was 5.9% greater than last year's level for the same week. Imports of natural gas from Canada rose 1.1% for the week, a 10.1% increase year over year, while LNG sendout remained at minimal levels. Overall, supply was flat week over week, decreasing just 0.5%.

Demand declines across all sectors. Total U.S. consumption fell this week by 4.3% compared with last week, though it remained slightly above (0.3%) consumption for this week last year. The largest decline was in the power sector, where consumption of natural gas fell 9.2% week over week, with cooler temperatures in the first half of the report week. Residential and commercial consumption fell by 2.0%, and industrial consumption was down 0.6%. Exports to Mexico dropped 1.6% from last week but were up by 28.5% year over year.

Prices fall modestly through the week at most locations. Prices at most market locations outside of the Northeast fell this week, generally by less than 10%. The Henry Hub spot price began the week at $2.99/MMBtu, fell through the week, and settled yesterday at $2.82/MMBtu. Prices at other major trading hubs moved in a similar pattern; the PG&E Citygate price, serving Northern California, fell from $3.34/MMBtu last Wednesday to $3.19/MMBtu yesterday. Prices at the Chicago Citygate fell from $3.01/MMBtu last Wednesday to close the week at $2.76/MMBtu yesterday.

 

Weather shifting from mild to warmer overall. Temperatures this week started out relatively mild, but warmed nationwide through the week. The cooler start held demand in check but the report week closed with warmer-than-normal temperatures in several regions, putting upward pressure on prices. EIA's Short-Term Energy Outlook, May 2015, expects prices to rise somewhat through the summer as demand picks up, but still remain relatively low.

Northeast prices mixed. Pricing for Transcontinental Pipeline's Zone 6, serving New York City, began the week at $2.59/MMBtu, dropped to below $2.00/MMBtu for the holiday weekend, before increasing to end the week at $2.86/MMBtu. At the Algonquin Citygate, which serves Boston, prices started the report week at $1.81/MMBtu, went lower with mild weather for the Memorial Day weekend to $1.62/MMBtu, but then rose 88¢ across Tuesday and Wednesday to close at $2.50/MMBtu yesterday. In general, Northeast pricing remained at or below the Henry Hub benchmark through the report week, though the Transco Zone 6 spot price, along with Tennessee Zone 6 200L (New York and New England) price, both rose higher than the Henry Hub price to close the week.

Marcellus prices fall. Marcellus-area prices fluctuated through the week, with trading points down at the close on Wednesday. At Tennessee's Zone 4 Marcellus location, prices fell from the starting point of $1.40/MMBtu on May 20 to $1.35/MMBtu yesterday. On the Transco Leidy Line, prices dropped from $1.56/MMBtu last Wednesday to $1.48/MMBtu yesterday, after dropping to $1.33/MMBtu on Friday. At Dominion South, which serves customers in portions of Pennsylvania, Ohio, Maryland, West Virginia, and Virginia, prices fell from $1.59/MMBtu a week ago to $1.55/MMBtu yesterday.

Nymex prices fall. The Nymex June 2015 contract started the report week at $2.915/MMBtu last Wednesday, falling to $2.815/MMBtu yesterday as it expired as the prompt month. The 12-month strip (the average of the 12 contracts between June 2015 and May 2016) fell from $3.120/MMBtu last Wednesday to $3.026/MMBtu yesterday.

Maintenance outages continue to slow production. Both scheduled and unscheduled maintenance occurred this week, which contributed to production levels falling 0.6%, according to Bentek Energy. Production in the Northeast was affected by the continued outage on Dominion's LN 280, located in Tioga County, Pennsylvania. Maintenance on that line concluded yesterday. Additional constraints were noted by Bentek Energy for the Southeast and Texas, where maintenance at the Mobil Bay processing plant in Alabama limited delivery to the Gulf South, Gulf Stream, and Transco pipelines. Additionally, Louisiana offshore production declined, likely caused by unplanned maintenance on the Discovery Pipeline located in the Gulf. Despite the drop in production this week, production was 5.9% greater than last year's level for the same week. Imports of natural gas from Canada rose 1.1% for the week, a 10.1% increase year over year, while LNG sendout remained at minimal levels. Overall, supply was flat week over week, decreasing just 0.5%.

Demand declines across all sectors. Total U.S. consumption fell this week by 4.3% compared with last week, though it remained slightly above (0.3%) consumption for this week last year. The largest decline was in the power sector, where consumption of natural gas fell 9.2% week over week, with cooler temperatures in the first half of the report week. Residential and commercial consumption fell by 2.0%, and industrial consumption was down 0.6%. Exports to Mexico dropped 1.6% from last week but were up by 28.5% year over year.