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U.S. natgas up 11% on colder weather forecasts; storage report awaited

          Nov 23 (Reuters) - U.S. natural gas futures jumped about 11% to a two-month high on the Wednesday
before the Thanksgiving Day holiday on forecasts for much colder weather and higher heating demand over the
next two weeks than previously expected.
    That price increase occurred before the release of a federal report expected to show a bigger-than-usual
storage draw last week when colder-than-normal weather boosted heating demand. With the cold lingering into
this week, consumers likely kept burning more gas than normal for heat this week too.
    Rapid price moves in recent weeks - futures have gained or lost more than 5% during half of the trading
days so far in November - boosted the contract's 30-day implied volatility index to a record high.
The market uses implied volatility to estimate likely price changes in the future.
    Analysts said the market could experience even more volatility on Friday when options for the December
contract expire on the New York Mercantile Exchange (NYMEX).
    "Looking ahead, as market players thin out even more for the remainder of the Thanksgiving holiday week,
bigger price volatility is expected as 'options expiration' caps the end of this week," analysts at energy
consulting firm Gelber & Associates told customers in a note.
    Analysts forecast U.S. utilities pulled 87 billion cubic feet (bcf) of gas from storage during the week
ended Nov. 18. That compares with a decrease of 14 bcf in the same week last year and a five-year (2017-2021)
average decline of 48 bcf.
    If correct, last week's decrease would cut stockpiles to 3.557 trillion cubic feet (tcf), or 1.3% below
the five-year average of 3.603 tcf for this time of the year.
    Front-month gas futures for December delivery on the NYMEX were up 71.8 cents, or 10.6%, to $7.497
per million British thermal units (mmBtu) at 9:04 a.m. EST (1404 GMT), putting the contract on track for its
highest close since Sept. 21.
    That also puts the front-month on track to close in technically overbought territory with a relative
strength index (RSI) over 70 for the first time since August.
    In the spot market, meanwhile, next-day gas prices at the PG&E Citygate in Northern California jumped
about 13% to their highest since February 2019.
    Also supporting futures were worries about a possible rail strike that could disrupt coal shipments to
utilities this winter, forcing power generators to burn more gas to produce electricity.
    In addition, the market had questions about whether Freeport LNG will be able to restart its liquefied
natural gas (LNG) export plant in Texas in mid-December as planned.
    Freeport LNG has not yet submitted a full request to the U.S. Department of Transportation's Pipeline and
Hazardous Materials Safety Administration (PHMSA) to restart the export plant, according to sources familiar
with the company's filings.
    That matters because once the 2.1-billion-cubic-feet-per-day (bcfd) plant restarts it will consume U.S.
gas to turn it into LNG for export, boosting demand for gas at the same time that cold winter weather will
boost heating demand.
    After Freeport LNG delayed the plant's restart from November to December, at least one LNG vessel - LNG
Rosenrot - turned away from the facility last week. Another vessel, Prism Agility, which is near the Bahamas
and says it will arrive at Freeport in a few days, also seems to have turned away from the plant on Wednesday,
according to ship tracking data from Refinitiv.
    There are, however, a few ships still waiting to pick up a cargo near Freeport - some have been there for
weeks - including Prism Brilliance, Prism Diversity and Prism Courage.
                                              Week ended     Week ended     Year ago   Five-year
                                                Nov 18         Nov 11        Nov 18     average
                                              (Forecast)      (Actual)                   Nov 18
 U.S. weekly natgas storage change (bcf):         -87            +64          -14         -48
 U.S. total natgas in storage (bcf):             3,557          3,644        3,626       3,603
 U.S. total storage versus 5-year average        -1.3%          -0.2%


 Global Gas Benchmark Futures ($ per mmBtu)   Current Day     Prior Day    This Month  Prior Year   Five Year
                                                                           Last Year    Average      Average
                                                                                          2021     (2017-2021)
 Henry Hub                                       7.28           6.78          5.12        3.73        2.89
 Title Transfer Facility (TTF)                   37.36          37.59        27.71       16.04        7.49
 Japan Korea Marker (JKM)                        29.22          27.30        32.98       18.00        8.95


 Refinitiv 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                                    353            311          298         323          341
 U.S. GFS CDDs                                     7              9            5           8            7
 U.S. GFS TDDs                                    360            320          303         331          348

 Refinitiv U.S. Weekly GFS Supply and Demand Forecasts
                                              Prior Week    Current Week   Next Week   This Week    Five-Year
                                                                                       Last Year   Average For
                                                                                                     Month
 U.S. Supply (bcfd)
 U.S. Lower 48 Dry Production                    100.0          99.7         100.0        96.8        89.6
 U.S. Imports from Canada                        68.6            9.2          8.7         9.3          8.2
 U.S. LNG Imports                                 0.0            0.0          0.0         0.1          0.1
 Total U.S. Supply                               108.6          108.9        108.7       106.2        97.9

 U.S. Demand (bcfd)
 U.S. Exports to Canada                           2.2            3.2          3.1         3.1          2.9
 U.S. Exports to Mexico                           5.5            5.4          5.6         5.4          5.1
 U.S. LNG Exports                                12.1           12.2          12.4        11.7         6.4
 U.S. Commercial                                 14.2           15.3          13.3        13.6        11.5
 U.S. Residential                                23.1           25.3          21.5        21.5        17.2
 U.S. Power Plant                                32.2           31.9          29.1        26.7        26.0
 U.S. Industrial                                 25.2           25.3          24.4        23.9        24.0
 U.S. Plant Fuel                                  4.9            4.9          4.9         4.9          4.9
 U.S. Pipe Distribution                           2.7            2.8          2.6         2.8          2.1
 U.S. Vehicle Fuel                                0.1            0.1          0.1         0.1          0.1
 Total U.S. Consumption                          102.6          105.6         96.0        93.5        85.8
 Total U.S. Demand                               122.4          126.4        117.1       113.7        100.2


 U.S. weekly power generation percent by fuel - EIA
                                              Week ended     Week ended    Week ended  Week ended  Week ended
                                                Nov 25         Nov 18        Nov 11      Nov 4       Oct 28
 Wind                                              9              9            15          12          15
 Solar                                             3              3            3           3            3
 Hydro                                             6              7            6           5            5
 Other                                             2              2            3           2            2
 Petroleum                                         0              0            0           0            0
 Natural Gas                                      41             41            38          39          37
 Coal                                             19             18            16          18          18
 Nuclear                                          20             20            20          20          19


 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu)
 Hub                                          Current Day     Prior Day
 Henry Hub 6.27           6.23
 Transco Z6 New York 5.92           6.80
 PG&E Citygate 10.99          9.72
 Dominion South 5.67           5.96
 Chicago Citygate 5.81           6.16
 Algonquin Citygate 8.40           10.72
 SoCal Citygate 10.50          9.38
 Waha Hub 5.04           4.85
 AECO 5.02           5.43

 SNL U.S. Power Next-Day Prices ($ per megawatt-hour)
 Hub                                          Current Day     Prior Day
 New England 82.25         120.75
 PJM West 58.00          65.50
 Ercot North 42.50          48.00
 Mid C 82.00          82.00
 Palo Verde 82.25          82.25
 SP-15 85.75          85.75
 (Reporting by Scott DiSavino; Editing by Paul Simao)



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