UPDATE 1-U.S. natgas jumps 8% on colder forecast, possible rail strike

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(Adds latest prices) Nov 21 (Reuters) - U.S. natural gas futures jumped about 8% to a two-week high on Monday on forecasts for colder weather and stronger heating demand this week than previously expected, and worries a possible rail strike could disrupt coal deliveries and force power generators to burn more gas. Traders also noted the expected restart of the 2.1-billion cubic feet per day (bcfd) Freeport LNG's liquefied natural gas (LNG) export plant in Texas in mid December, if it happens, would boost demand for gas in coming weeks. The plant shut six months ago after a fire. Workers at the largest U.S. rail union voted against a tentative contract deal reached in September, raising the possibility of a year-end strike that could cause significant damage to the U.S. economy and strand vital shipments of food and fuel. The market, meanwhile, seemed to ignore forecasts for less cold weather in early December that will cut heating demand next week below what was previously expected. Freeport LNG said last week that the company would not meet its previously announced November restart target for its export plant and was now projecting a mid-December restart, if regulators approve. Even though the delayed Freeport restart caused one LNG vessel - LNG Rosenrot - to turn away from the plant last week, several other ships have remained near the facility - some for weeks - including Prism Brilliance, Prism Diversity and Prism Courage. In addition, the Prism Agility was expected to arrive at the plant site in a few days, according to ship tracking data from Refinitiv. In other LNG news, the Cadiz Knutsen was sitting in Boston Harbor outside the Everett LNG terminal in Massachusetts with a cargo of the super-cooled fuel from Trinidad. That would be the first LNG vessel to visit Everett since August, according to Refinitiv data. But with Everett competing with European buyers willing to pay around $35 per million British thermal units (mmBtu) for gas versus just $6 in the United States, the Massachusetts port has imported only 16.7 billion cubic feet (bcf) of gas as LNG during the first 10 months of this year. That is down from 18.1 bcf during the same period in 2021 and a five-year (2017-2021) average of 33.3 bcf, according to federal energy data. New England depends on LNG and oil to fuel some power plants on the coldest days when most of the region's pipeline gas is being used to heat homes and businesses. About half of the power generated in New England comes from gas-fired plants. Front-month gas futures for December delivery rose 47.3 cents, or 7.5%, to settle at $6.776 per mmBtu, putting the contract on track for its highest close since Nov. 7. The premium of futures for January over December , meanwhile, was on track to close at a record high for a second day in a row as some in the market started to give up on the prospect of extreme cold in December. Gas futures were up about 81% so far this year as much higher global gas prices feed demand for U.S. exports due to supply disruptions and sanctions linked to Russia's invasion of Ukraine. Gas was trading at $35 per mmBtu at the Dutch Title Transfer Facility (TTF) in Europe and $27 at the Japan Korea Marker (JKM) in Asia. With the coming of less cold weather, Refinitiv projected average U.S. gas demand, including exports, would drop from 126.2 bcfd this week to 115.2 bcfd next week. The forecasts for this week was higher than Refinitiv's outlook on Friday, while its forecast for next week was lower. Week ended Week ended Year ago Five-year Nov 18 Nov 11 Nov 18 average (Forecast) (Actual) Nov 18 U.S. weekly natgas storage change (bcf): -77 +64 -14 -48 U.S. total natgas in storage (bcf): 3,567 3,644 3,626 3,603 U.S. total storage versus 5-year average -1.0% -0.2% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2021 (2017-2021) Henry Hub 6.32 6.30 5.12 3.73 2.89 Title Transfer Facility (TTF) 34.88 32.92 27.71 16.04 7.49 Japan Korea Marker (JKM) 26.39 26.32 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 319 340 298 323 332 U.S. GFS CDDs 5 4 5 8 7 U.S. GFS TDDs 324 344 303 331 339 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 8.5 9.3 8.2 U.S. LNG Imports 0.0 0.0 0.0 0.1 0.1 Total U.S. Supply 108.6 108.9 108.5 106.2 97.9 U.S. Demand (bcfd) U.S. Exports to Canada 2.2 3.0 2.8 3.1 2.9 U.S. Exports to Mexico 5.5 5.3 5.5 5.4 5.1 U.S. LNG Exports 12.1 12.4 12.7 11.7 6.4 U.S. Commercial 14.2 15.4 12.9 13.6 11.5 U.S. Residential 23.1 25.4 20.5 21.5 17.2 U.S. Power Plant 32.2 31.5 29.0 26.7 26.0 U.S. Industrial 25.2 25.3 24.3 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 2.5 2.8 2.1 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 0.1 Total U.S. Consumption 102.6 105.5 94.2 93.5 85.8 Total U.S. Demand 122.4 126.2 115.2 113.7 100.2 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 95 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 40 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 6.10 6.20 Transco Z6 New York 8.08 7.20 PG&E Citygate 8.71 8.80 Dominion South 5.78 5.83 Chicago Citygate 5.93 6.24 Algonquin Citygate 11.25 8.16 SoCal Citygate 8.54 8.64 Waha Hub 5.47 4.97 AECO 4.91 4.96 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 87.50 78.50 PJM West 68.50 81.75 Ercot North 76.00 50.00 Mid C 81.25 89.00 Palo Verde 62.75 84.50 SP-15 64.25 84.75 (Reporting by Scott DiSavino; Editing by Andrea Ricci and Nick Zieminski)

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