NATO: Natural Gas End of Day Summary: Henry Hub Surges
Henry Hub is set to close with a net gain on the week of nearly 19%. Cold weather on the US East Coast looks set to continue. Meanwhile, production has dipped and LNG export terminal feedgas flows rise to record levels.
- US Natgas FEB 25 up 7.6% at 3.98$/mmbtu
- US Natgas MAR 25 up 4.4% at 3.38$/mmbtu
- Baker Hughes US Gas Rig Count: 100 (-3) – down 20 rigs, or 16.7% on the year
- Lower 48 natural gas demand has dipped slightly to 114.2bcf/d today, according to Bloomberg but remain above previous five-year average levels of around 99.5bcf/d.
- The NOAA 6–14-day outlook still showed below normal temperatures on the East Coast throughout although with levels closer to normal in more central and western regions.
- US domestic natural gas production is estimated unchanged on the day at 101.7bcf/d today, according to Bloomberg,
- US LNG export terminal feedgas is estimated at a record high of 15.1bcf/d today, according to Bloomberg,
- Export flows to Mexico are holding steady at 6.50bcf/d today after recovering from a drop in late Dec.
- Spark's Netbacks show that the US front month LNG arb to NE-Asia (via the Cape of Good Hope) is currently priced at -$0.610/MMBtu.
- The European share of global LNG fell to 24% in 2024 from 30% in 2023, as Asia rebuilt its share, according to ICIS.
- LNG transit through the Panama Canal saw a slight uptick in December, Platts said.
- End-month open interest and traded volume for JKM LNG futures reached unprecedented levels in 2024, Platts said.
- The first LNG cargo has arrived at Hindustan Petroleum’s 5 mtpa Chhara LNG terminal in Gujarat, India, according to Vortexa.
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EURGBP TECHS: Southbound
- RES 4: 0.8448 High Oct 31 and reversal trigger
- RES 3: 08376 High Nov 19 and a bull trigger
- RES 2: 0.8337 50-day EMA
- RES 1: 0.8306 20-day EMA
- PRICE: 0.8229 @ 15:42 GMT Dec 11
- SUP 1: 0.8225 Low Dec 11
- SUP 2: 0.8203 Low Mar 7 2022 and a major support
- SUP 3: 0.8200 Round number support
- SUP 4: 0.8188 1.00 proj of the Oct 31 - Nov 11 - 19 price swing
A fourth consecutive session of lower lows and lower highs for EUR/GBP to pile pressure on support, with 0.8203 the level to watch - the Mar 7 ‘22 low and the lowest point of a multi-year range. A break through support here would work against the RSI and could tip the price into technically oversold territory for the first time since September. This week's break lower has cancelled a recent bullish signal - an engulfing candle on Nov 12 - as rate differentials and aggressive ECB pricing dictate play.
MNI: US NOV TREASURY BUDGET -$366.8B
- MNI: US NOV TREASURY BUDGET -$366.8B
US TSYS: Weakest Levels Of Day Pre-Budget Data
Front TYs have completed the reversal from post-CPI session highs, touching the worst levels of the day at 110-22 in the last few minutes.
- That's just a few ticks above the December low (Dec 4) of 110-18, with our tech analyst identifying first key support at 110-01/109-20 Low Nov 25 / Low Nov 20/21.
- No particular trigger for the move lower, which comes despite a strong 10Y Treasury auction, alongside session highs for WTI crude and stocks.
- The Treasury curve has moved up in parallel fashion though, holding on to post-CPI steepening: 2s10s +3bp at 11.0bp,
- Nov Federal Budget Balance coming up shortly (1400ET).
