Drought

A persistent drought impacting the Panama Canal has left LNG shippers with a few alternatives; either wait for weeks in a growing queue, pay exorbitant prices to jump the line or take a long detour. The water levels at Alajuela and Gatun, the two artificial lakes that supply water to the canal, have continued to…

The Panama Canal Authority said this week that it would reduce the number of vessels that can transit the waterway from 32 to 25 on Nov. 3. Daily transits would be further cut to 24 on Nov. 8, 22 on Dec. 1, 20 on Jan. 1 and 18 on Feb. 1.

More U.S. LNG cargoes are taking longer and costlier routes to reach consumers in Asia as a drought impacting levels at the Panama Canal has increased wait times to transit the waterway. “The Panama Canal remains a primary route for U.S. LNG to access Asian markets, though an increased volume of trade is utilizing other…

The National Oceanic and Atmospheric Administration (NOAA) is predicting expanded drought conditions for much of the Lower 48 this spring, foreshadowing significant implications for natural gas producers and consumers. “Severe to exceptional drought has persisted in some areas of the West since the summer of 2020 and drought has expanded to the southern Plains and…

Brazilian national oil company Petróleo Brasileiro (Petrobras) reported a 43.5% year/year (y/y) increase in domestic natural gas sales volumes during the third quarter as severe drought limited hydroelectric output in the South American country. Gas sales totaled 89 MMm3/d, up from 62 MMm3/d in 3Q2020, management said in presenting the firm’s quarterly earnings. Petrobras relied…

The shutdown of California’s 644 MW Edward Hyatt hydroelectric power plant because of insufficient water levels at the Oroville Dam reservoir is squeezing an already tight power market in the western United States, according to Moody’s Investors Services. On Aug. 5, the California Department of Water Resources took the plant offline. This has contributed to…

The latest round of government storage data was about as bullish as it could be, but sellers came into the fold once weather models showed the upcoming heat being a little less intense. The September Nymex gas futures contract settled Thursday at $4.140, off 1.8 cents day/day. October slipped 1.5 cents to $4.148. Spot gas…

With the western United States now in its second year of a widespread drought, the extraordinarily low water levels at some of the critical reservoirs are adding a layer of uncertainty to electric reliability this summer. The power generated from the West’s fleet of hydroelectric generating facilities is on pace to be much lower than…

California power grid officials will not make it official until April, but state energy regulators and large consumers are expecting a deluge of cheap hydroelectric supplies this spring and summer, although there are still factors that could dampen the full unfolding of that scenario after five years of sub-normal water power due to the region’s prolonged drought.