Thursday’s EIA report (week ended 8 Mar) – EA Final Estimate: -209 bcf
- We forecast that this week’s EIA report will show a draw of 209 bcf—the largest ever recorded in March. The main driver is a 7.3 bcf/d w/w spike in res-com demand due to a 15% w/w rise in gas-weighted HDDs (GWHDDs). Frigid temperatures hovered over much of the Northeast during the reference week, with lows in New York dropping below 20°F, versus historical normal lows of 30°F for the time of year. Gains in power burn (+1.7 bcf/d w/w) and a record weekly high for LNG feedgas demand of 5.4 bcf/d (+0.2 bcf/d w/w) also drove total demand higher.
- Cold weather caused a 0.4 bcf/d w/w fall in Lower 48 output, with freeze-offs cutting output w/w in Appalachia by 0.5 bcf/d and in the Permian by 0.2 bcf/d. The Rockies gained 0.2 bcf/d w/w.
Next Thursday’s report (week ending 15 Mar) – EA Estimate: -65 bcf
- Moderate weather will see the withdrawal rate drop to 65 bcf in the current week, with res-com demand set to plummet by 15.2 bcf/d w/w on a 30% w/w drop in GWHDDs. Gas use in the industrial sector will also shrink, by 1.2 bcf/d w/w, while power burn will drop by 4.3 bcf/d w/w.
- The decline in gas demand for power would be greater but for nuclear generation outages reaching the highest levels of the spring refuel season so far this week. A 2.5 GW outage at the Browns Ferry reactor in Alabama leads the offline nuclear capacity.
- We forecast total Lower 48 production will edge up by 0.3 bcf/d w/w. Daily low temperatures in the Permian rose above freezing on 7 March, and the region is on course to return to its pre-cold baseline by gaining 0.2 bcf/d w/w. Gulf of Mexico receipts are also set to grow by 0.2 bcf/d w/w.
- Despite the production gains, total supply is on track to decline by 1.1 bcf/d w/w. We project net imports from Canada will sink by 0.8 bcf/d w/w to 5.3 bcf/d. Net imports in the east, which peaked at 1.7 bcf/d on 6 March, fell to no net exchange on 10 March as temperatures in the US Northeast rose. Meanwhile, US exports through the St. Clair border point in Michigan are on course to jump by 0.5 bcf/d w/w, thus reducing total US net imports.
- We forecast that LNG feedgas flows will drop by 0.4 bcf/d w/w. Inflows to Sabine Pass fell by 0.5 bcf/d d/d on both 10 and 11 March to 2.9 bcf/d as fog once again interfered with ship-loadings at the terminal. We mentioned last week in Panorama: Foggy tank tops, 7 March 2019 that weather disruptions would likely depress feedgas flows to Sabine due to the facility’s high inventory levels. The terminal currently has 15.5 bcf in storage out of a maximum 17.4 bcf, meaning that it cannot take a full day of feedgas (approximately 4.0 bcf/d) without first loading another export cargo.
|Fig 1: Regional flows and fundamentals model, bcf|
|Source: Energy Aspects|
|Fig 2: Balance forecasts, bcf/d|
|Source: Energy Aspects|