Western Price Survey
November 6, 2015
Continued additions to natural gas inventories and mild winter weather forecasts are still worrying traders, but a less-than-anticipated storage addition this week lent some price support.
Working natural gas in storage reached 3,929 Bcf as of Oct. 30 according to Energy Information Administration estimates, a net increase of 52 Bcf from the previous week.
This ties the all-time record, set the week ending Nov. 2, 2012.
"Working gas stocks appear poised to establish an all-time record high in next week's storage report if working gas stocks increase during the coming week, as typically occurs in early November," stated the EIA. The increase is attributed to record injections in the Producing Region; additions in the West are "off the pace established in 2012."
Storage levels are now 10.4 percent greater than a year ago and 3.9 percent greater than the five-year average. The West recorded a net addition of 4 Bcf of natural gas to storage, which is 11 Bcf greater than the five-year average.
Henry Hub gas spot values eroded 2 cents in Thursday-to-Thursday trading, ending at $2.10/MMBtu Nov. 5 after a dip below the $2/MMBtu mark (see table). Sumas natural gas posted the greatest gains, adding 10 cents to reach $2.12/MMBtu.
Forecasts for cooler weather in late November have "encouraged buyers in recent days," Enerfax stated. "However, many traders are still betting that those forecasts don't hold and that prices come back down below $2.30. While Thursday's [EIA] data [gave] the market some support, it may be limited."
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Western peak power prices gained between $4.45 and $8 in the Oct. 30 to Nov. 6 trading period. California-Oregon Border daytime power posted the greatest gain, up $8 to $25.45/MWh. Average prices ranged from $22/MWh at Mid-Columbia to $33.10/MWh at North of Path 15.
Nighttime power prices fared similarly, with values up between $2.20 and $3.45, on average, by Friday. Prices ranged from $20/MWh at Mid-C to $22.65/MWh at Palo Verde.
Demand peaked on the Cal-ISO grid at 29,452 MW Oct. 30, which should be the week's high.
Meanwhile, Western natural gas prices were roughly $1.50 less per MMBtu on average in October 2015 compared to the same period last year.
Western power prices during October 2015 were also significantly lower, on average, than last year's [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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