US natgas futures rebound ahead of March contract expiry

Feb 26 (Reuters) - U.S. natural gas futures gained more than 6% on Monday, ahead of the expiration of the March contract, in a technical rebound following a sharp retreat in the last two sessions. Front-month gas futures were down 7.5% or 12.9 cents to settle at $1.603 per million British thermal units. The March contract is set to expire on Tuesday. The market seems to have found a bottom, with the "negative news experienced most of the winter, with low demand, (having) run its course at this point," said Gary Cunningham, director of market research at Tradition Energy. "Now we're looking forward to where do we go from here and that's where you're starting to see those CapEx cuts have a bigger impact and a return to more normal weather patterns for the summer." On Wednesday, prices soared about 13% after Chesapeake Energy, soon to be the biggest U.S. gas producer after its merger with Southwestern Energy, cut planned production for 2024 by roughly 30% after a recent plunge in prices to a 3-1/2 year low. Natural gas prices have plunged 32% so far this year, hurt by a mild winter that has left stockpiles well above normal, while output remained near record levels despite an Arctic freeze in January that briefly cut output and sent gas demand to a record high. Financial company LSEG said gas output in the U.S. Lower 48 states has risen to an average of 105.5 billion cubic feet per day (bcfd) so far in February from 102.1 bcfd in January, still shy of the monthly record of 106.3 bcfd in December. "Production curtailments may prove capable of placing a bottom in this market within the next few weeks, but we still see April futures drafting back down to about the $1.60 level, the low established just prior to the announced production cuts," energy advisory Ritterbusch and Associates said in a note. QatarEnergy chief Saad al-Kaabi said on Sunday a new expansion of its liquefied natural gas (LNG) production will add 16 million metric tons per year to its expansion plans, bringing total capacity to 142 million tons per year (tpy). The European benchmark wholesale gas price also declined, remaining near its lowest level in around three years, as weak demand and high storage inventories outweighed cold weather forecasts and lower renewables output. Week ended Week ended Year ago Five-year Feb 23 Feb 16 Feb 23 average Forecast Actual Feb 23 U.S. weekly natgas storage change (bcf): -97 -60 -79 -143 U.S. total natgas in storage (bcf): 2,373 2,470 2,126 1,876 U.S. total storage versus 5-year average 26.5% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2023 (2018-2022) Henry Hub 1.73 1.62 2.44 2.66 3.60 Title Transfer Facility (TTF) 7.53 7.25 16.52 13.04 14.39 Japan Korea Marker (JKM) 8.13 8.16 16.87 14.39 14.31 LSEG Heating (HDD), Cooling (CDD) and Total (TDD) Degree Days Two-Week Total Forecast Current Day Prior Day Prior Year 10-Year 30-Year Norm Norm U.S. GFS HDDs 258.5 267 346 U.S. GFS CDDs 9.6 8 8 U.S. GFS TDDs 268.1 275 354 LSEG U.S. Weekly GFS Supply and Demand Forecasts Prior Week Current Next Week This Week Five-Year Week Last Year (2019-2023) Average For Month U.S. Supply (bcfd) U.S. Lower 48 Dry Production 105.1 103.5 103.9 101.3 92.4 U.S. Imports from Canada 9.0 8.7 8.7 8.7 9.1 U.S. LNG Imports 0.0 0.0 0.0 0.0 0.2 Total U.S. Supply 114.1 112.2 112.5 110.0 101.7 U.S. Demand (bcfd) U.S. Exports to Canada 3.5 3.6 3.6 2.6 2.7 U.S. Exports to Mexico 6.4 5.7 6.2 5.8 5.2 U.S. LNG Exports 13.6 13.9 13.7 12.8 8.4 U.S. Commercial 14.8 12.9 11.3 14.1 16.3 U.S. Residential 23.8 20.0 17.6 22.6 27.6 U.S. Power Plant 34.3 31.3 31.4 30.3 29.3 U.S. Industrial 24.9 24.2 23.5 24.1 25.4 U.S. Plant Fuel 5.2 5.1 5.1 5.2 5.3 U.S. Pipe Distribution 2.8 2.6 2.4 2.7 2.7 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 105.9 96.1 91.5 99.1 106.7 Total U.S. Demand 129.4 119.3 115.1 120.3 123.0 U.S. Northwest River Forecast Center (NWRFC) at The Dalles Dam Current Day Prior Day 2023 2022 2021 % of Normal % of Normal % of Normal % of Normal % of Normal Forecast Forecast Actual Actual Actual Apr-Sep 81 79 83 107 81 Jan-Jul 83 81 77 102 79 Oct-Sep 82 81 76 103 81 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended March 1 Feb 23 Feb 16 Feb 9 Feb 2 Wind 12 11 14 9 Solar 4 4 3 3 Hydro 7 7 7 7 Other 1 1 1 2 Petroleum 0 0 0 0 Natural Gas 41 41 38 40 Coal 15 16 16 18 Nuclear 20 21 21 20 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 1.52 1.62 Transco Z6 New York 1.49 1.35 PG&E Citygate 2.49 2.71 Eastern Gas (old Dominion South) 1.39 1.21 Chicago Citygate 1.35 1.45 Algonquin Citygate 3.23 2.10 SoCal Citygate 2.37 2.83 Waha Hub 0.19 0.84 AECO 1.62 1.63 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 30.75 29.50 PJM West 27.25 23.25 Ercot North 10.25 21.50 Mid C 35.66 45.27 Palo Verde 22.25 25.10 SP-15 21.50 28.00 (Reporting by Ashitha Shivaprasad and Anjana Anil in Bengaluru; Editing by David Evans)