December 2021 was the 2nd warmest on record since 1950 with 675 GWHDDs [1st place was Dec 2015 at 634 GWHDDs, and 3rd place was Dec 2006 with 747 GWHDDs]. The above normal temperatures spanned a majority of the US. This was the warmest Dec in the South Central region (266 vs 396 in 1984) while coming in at #2 in the Midwest (870 vs 794 in 2015), East (680 vs 666 in 2015), and Mountain (872 vs 848 in 1980) EIA regions.
Maxar Weather puts January more in the normal range. They currently have Jan falling in between the 10Y and 30Y normal.
“Stratospheric polar vortex looks to remain strong into the back half of January; so as long as there is a stratospheric to tropospheric connection, we should keep the +AO deeper into the month. That said, there may be a shift from what we have in the 11-15 Day back toward the -PNA (the primary pattern in December) after the period. We think this transition takes place in the 16-20 Day; although, confidence is still low given the lead time.”
Today’s Fundamentals
Daily US natural gas production is estimated to be 91.4 Bcf/d this morning. Today’s estimated production is -1.64 Bcf/d to yesterday, and -4.23 Bcf/d to the 7D average. Production has been quite volatile since the start of the holiday season. We saw a big push higher in production during the last week of December, and then a big drop off to start the year. The drop looks to be associated with potential freeze-offs across West Texas and the App basin that has kept production much lower.
Natural gas consumption is modelled to be 108.7 Bcf today, -9 Bcf/d to yesterday, and +9.03 Bcf/d to the 7D average. US power burns are expected to be 29.9 Bcf today, and US ResComm usage is expected to be 46.3 Bcf.
Net LNG deliveries are expected to be 12.3 Bcf today. Total deliveries have been hovering around 12 Bcf/d for the past few weeks.
Mexican exports are expected to be 6.1 Bcf today, and net Canadian imports are expected to be 5.7 Bcf today. Canadian imports have jumped substantially over the past few days as US domestic production has dropped.
The storage outlook for the upcoming report is -45 Bcf today. We expect to see a wide range of estimates for this week’s report as last week had a surge in production, and it was a long (but mainly warm at the national level) holiday week.
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ION-Energy-Daily-Report-Jan-04-2022.pdf