Daily Market Report – February 19, 2021

The EIA reported at storage draw of 237 Bcf yesterday for week ending Feb 12^th. This now shows two back to back reports lighter than market expectations. The March futures price was already moving lower yesterday morning as power and production was being resumed in Texas, but the reported added further downward pressure.

The situation continues to get better in Texas. PowerOutage.us states only 185k people are now without power. ERCOT is still at a level 3 alert, but weather shoots up today where the system should get back to normal.

Total gas consumption for Power, RC, and Industrial across the US is nearly 13 Bcf/d off the peak seen on Feb 14/15 today. By Feb 22^nd we should see demand levels significantly drop. That being said, overnight runs did add some cooler weather for next week – specifically the 26/27. This is no where near the cold we saw earlier this week though.

Production started to resume today. Evening cycle pipeline nomination data has L48 production higher by 2.4 Bcf/d. With the power outage situation in Texas not looking bad, we expect production sites to get up and running, along with processing facilities. We should see a significant amount of the freeze-off production return this week.

Today’s Fundamentals:

Daily US natural gas production is estimated to be  73.3 Bcf/d this morning. Today’s estimated production is +2.43 Bcf/d to yesterday, and -3.93 Bcf/d to the 7D average.

Natural gas consumption is modelled to be 111.8 Bcf today,  -2.66 Bcf/d to yesterday, and -9.01 Bcf/d to the 7D average. US power burns are expected to be 29.64 Bcf today, and US ResComm usage is expected to be 53.2 Bcf.

Net LNG deliveries are expected to be 5.2 Bcf today, although this is likely to be revised lower. This is the pattern we have seen over the last few days.

Mexican exports are expected to be 6 Bcf today, and net Canadian imports are expected to be 0 Bcf today.

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