Western Price Survey
December 4, 2015
The de facto start to winter occurred this week with the first net natural gas storage withdrawal.
Working natural gas in storage was 3,956 Bcf as of Nov. 27, according to U.S. Energy Information Administration estimates. This is a net decrease of 53 Bcf compared to the previous week and greater than market expectations, which anticipated a 49 Bcf withdrawal.
Storage levels are now 15.9 percent greater than a year ago and 6.7 percent greater than the five-year average.
The Pacific region recorded a net withdrawal of 6 Bcf of natural gas from storage, which is 6.8 Bcf greater than the five-year average.
"The traditional end to the injection season is October 31; this year, however, injections continued through November 27," according to the EIA. The agency estimates there was a net overall injection of 2,469 Bcf between April and October 2015, which is the second-highest on record.
Warmer-than-normal November weather kept storage inventories at record levels. The agency expects a warmer-than-normal winter forecast "could limit withdrawals somewhat in the coming months."
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Henry Hub gas spot values shed 3 cents in Tuesday-to-Thursday trading, ending at $2.12/MMBtu Dec. 3. Western hubs' average values moved lower, dropping between 8 and 16 cents in the abbreviated trading period. Stanfield natural gas posted the greatest loss, down 16 cents to $2.16/MMBtu.
Western peak power prices generally lost between 20 cents and almost $4 in the Nov. 25 to Dec. 4 trading period. South of Path 15 proved the exception, adding roughly 65 cents to hit an average of $28.70/MWh. Prices at the end of the trading period, which was interrupted by the Thanksgiving holiday, ranged from $20.85/MWh at Mid-Columbia to $28.70 at SP15.
Nighttime power prices fared similarly, with Pacific Northwest values losing roughly $5, on average, by Friday. Average prices ranged from $19.30/MWh at Mid-Columbia to $19.95/MWh at the California-Oregon Border.
Meanwhile, Western natural gas prices were roughly $2 less per MMBtu on average in November 2015 compared to the same period last year.
Western power prices during November 2015 were also significantly lower -- by between $17.65 and almost $32, on average -- than in the same month last year. California-Oregon Border, for example, reached an average high of $67.50/MWh in November 2014, while this year, the average high price at the hub was $35.62/MWh [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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