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US gas demand climbs on cold weather in week to Feb. 1

Colder weather drove up natural gas demand in the United States during the week that ended Feb. 1, while supply remained flat, the U.S. Energy Information Administration said in its latest "Natural Gas Weekly Update" released Feb. 2.

Overall U.S. gas consumption rose 13% week on week, from 74.3 Bcf/d to 84.3 Bcf/d. "Although temperatures warmed by the end of the report week, this report week was colder than the previous one, pushing up demand for home heating," the EIA said.

Residential/commercial-sector consumption notched a 27% increase week on week as it jumped from 31.5 Bcf/d to 39.9 Bcf/d. Meanwhile, power burn and industrial-sector demand each logged a 4% gain versus the week-ago level, as averages climbed from 20.8 Bcf/d to 21.7 Bcf/d and from 22.0 Bcf/d to 22.7 Bcf/d, respectively. Exports to Mexico remained the same as in the prior week at an average at 4.0 Bcf/d.

Natural gas pipeline flows to the Sabine Pass liquefaction terminal during the week in review averaged 1.8 Bcf/d, unchanged week on week. Four vessels with a combined LNG-carrying capacity of 14.1 Bcf left the terminal in the previous week.

According to the EIA, fifteen LNG cargoes were exported from Sabine Pass in January, exceeding the previous record of 12 exported cargoes in December 2016.

Total U.S. gas supply held constant week on week at an average at 76.3 Bcf/d. Dry production was steady relative to the week-ago level at an average at 70.4 Bcf/d, as net imports from Canada that averaged at 5.8 Bcf/d during the week in review reportedly posted a 1% decline week over week.

In terms of inventories, the latest storage data from the EIA outlined a net 87-Bcf drawdown from stocks for the week to Jan. 27 that was below both the 166-Bcf five-year average withdrawal and a 169-Bcf pull seen in the corresponding week in 2016. It left total working gas in storage at 2,711 Bcf, or 266 Bcf below the year-ago level and 59 Bcf above the five-year average of 2,652 Bcf.

The latest storage figure marks the second consecutive week that warmer-than-normal weather that limited natural gas demand for heating resulted in an inventory draw below average, the EIA said. Temperatures across the contiguous U.S. during the storage report period climbed 4 degrees from the week-ago level to average at 44 degrees Fahrenheit, which is 11 degrees higher than normal and 10 degrees higher than last year at this time. Heating degree days totaled 151, versus 219 a year ago and a normal of 223.

Cumulatively, working gas stocks have posted smaller drawdowns in January, against the strong withdrawals seen in December 2016, the EIA observed. "The 2016–17 heating season began quickly in December, posting three weeks of net withdrawals topping the 200 Bcf threshold. However, since then net withdrawals have fallen well short of historical norms during January," the agency said.

Net withdrawals for the period of Jan. 1-27 have totaled 557 Bcf, compared with the five-year average of 601 Bcf over the same period, EIA data showed. By contrast, net stock drawdowns in December 2016 totaled 691 Bcf, versus the five-year average of 453 Bcf over the same period.