Daily Market Report – October 2, 2020 (report attached)

Yesterday, the EIA reported a 76 Bcf injection which came in a couple of Bcf lower than market expectations. Total working gas in storage as of Sept 25^th stood at 3,756 Bcf, 471 Bcf above year-ago levels and 405 Bcf above the five-year average. As storage containment issues continue to be at risk, Western Canada storage is already at its all time high set in 2016. The injection trajectory has been steep at AECO this summer with strong production but lower demand due to oil sand project shut-ins and COVID related demand destruction. The usual outlet for Canadian natgas is the US, but not this summer with with growing US production and high storage levels everywhere. This is something to look out for as a weak AECO could push more gas into the US before a serious heating season starts up north.

Today’s Fundamentals:

Daily US natural gas production is estimated to be  85.8 Bcf/d this morning. Today’s estimated production is +0.29 Bcf/d to yesterday, and +0.01 Bcf/d to the 7D average.  

Natural gas consumption is modelled to be 73.4 Bcf today,  +3.5 Bcf/d to yesterday, and +5.23 Bcf/d to the 7D average. US power burns are expected to be 31.44 Bcf today, and US ResComm usage is expected to be 15.9 Bcf.

Net LNG deliveries are expected to be 7.1 Bcf today.

Mexican exports are expected to be 6.3 Bcf today, and net Canadian imports are expected to be 3.8 Bcf today.

Bloomberg IM: Het Shah
enelyst DM: @het.co
Tel: 917-975-2960

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