NG/LNG - This Week's Main Drivers and the Look Ahead | 9.13.26
This Week's Main Drivers:
EIA NG Storage: +40 BCF vs. +69 BCF last year and the +52 BCF 5-year average. The smaller injection keeps the storage deficit narrative alive as we approach winter.
Crude oil rocketed above $100/BBL. as the Iran-US war continues to disrupt energy flows and effectively shut the Strait of Hormuz to LNG exports. No LNG tankers transited Hormuz Wednesday, underscoring the severity of the disruption.
Summer heat is finally retreating, with the most persistent heat concentrated across the Southeast from Texas to South Carolina. Fall is knocking on the door.
Lower wind generation is supporting additional natural gas burn in ERCOT even as temperatures moderate.
Golden Pass Train 1 continues to struggle to ramp toward nameplate capacity, limiting incremental U.S. LNG supply.
Super El Niño fears continue to dominate the winter outlook. NOAA now sees a high probability of a historically strong El Niño through late 2026.
The Pacific "Ring of Fire" remains active, with Anak Krakatau erupting in Indonesia.
Williams completed its $5.5B acquisition of Momentum Midstream, adding more than 4,000 miles of Haynesville infrastructure and 6 Bcf/d of gathering capacity.
The Look Ahead:
Inflation risk is rising as higher oil, gas and transportation costs feed into the broader economy.
If Hormuz remains effectively closed through year-end, a global bidding war for available spot LNG cargoes could intensify.
Front-to-back NG injection spreads have reached support and bounced higher—a potentially important signal as winter risk approaches.
Papua LNG is moving closer to FID, with partners targeting a decision in 4Q 2026.
El Niño also raises concerns about Panama Canal water availability and LNG transit.
Bangladesh is seeking six (6) October spot LNG cargoes, while Pakistan's failed LNG tender points toward increasingly expensive spot supply.
QatarEnergy is reportedly looking to secure additional long-term U.S. LNG.
Could the Iran-US war ultimately push the Arab Gulf states toward greater energy integration and cooperation?
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