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Natural Gas Weekly: Total Demand To Peak On March 7

February 28, 2019  

This report covers the week ending March 1, 2019. Daily data for February 23 to February 28 is estimated. Daily data for March 1 is forecast.

Total Supply/Demand Balance

We estimate that aggregate demand for American natural gas (consumption + exports) will total around 829 bcf for the week ending March 1 (down 4.0% w-o-w, but up 23.0% y-o-y). The deviation from the norm should remain positive but decline from +27% to +20% (see the chart below).

This week, the weather conditions have warmed up across the country - but particularly in the Southeast and Western parts of the U.S. We estimate that the number of nation-wide heating degree-days (HDDs) will drop by 9.0% w-o-w in the week ending March 1. At the same time, non-degree-day factors are spurring some extra consumption - particularly in the Electric Power sector. The most important four non-degree-day factors that we are looking at are: the spread between natural gas and coalwind speedshydro inflows,and nuclear outages. Specifically, lower ng/coal spreads are adding as much as 1.0 bcf/d of potential coal-to-gas-switching (compared to February 2018), while the level of hydro inflows is some 500 MMcf/d weaker compared to previous year. According to U.S. Nuclear Regulatory Commission, nuclear outages averaged 9,900 MW this week, 5% above the historical average. Overall, total energy demand (measured in total degree-days) should be above last year's level by as much as 39%.

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