NGI Mexico GPI

A bearish government storage report, combined with forecasts showing too little cold too late in the season, pressured natural gas futures lower Thursday.

Natural gas marketers in Mexico transacted an average volume of 6.69 Bcf/d during the second half of 2018 (2H2018), up 35% from the 4.96 Bcf/d averaged in the year-earlier period, with December deals surging, according to the latest IPGN monthly natural gas price index published by the Comisión Reguladora de Energía (CRE).

Fitch Ratings on Tuesday lowered by two notches the long-term foreign and local-currency issuer default ratings (IDRs) for Mexican national oil company Petróleos Mexicanos (Pemex) to ”BBB-’from ”BBB+’, and downgraded Pemex’s national long-term ratings to ”AA (mex)’ from ”AAA (mex)’, with a negative rating outlook.

For a market dominated by weather, the polar blast sweeping across the eastern half of the country arrived too little too late for natural gas traders eyeing the extended mild break on tap beginning this weekend. The Nymex March gas contract, on its first day in the prompt-month position, slipped 4.9 cents to $2.854 on Wednesday, even as temperatures in Chicago plunged more than 20 degrees below zero earlier in the day. The April gas contract was down 3.9 cents to $2.808.

A local price index for natural gas in Mexico will develop over time, but it will likely depend on increased production of domestic natural gas resources, a group of experts said earlier this month.

The February Nymex natural gas futures contract ended on a positive note Tuesday, recovering from early losses as long-range forecasts hinted at more cold arriving after a milder break next week. In the spot market, Midwest prices surged for a second straight day as forecasters were looking for the most extreme temperatures from this week’s polar cold front to hit the region Wednesday; the NGI Spot Gas National Avg. added 77.5 cents to $4.400/MMBtu.

Imported natural gas will continue to be a growing part of the energy mix in Mexico despite calls from the new government of Andrés Manuel López Obrador to reengineer the sector, according to a range of opinions shared at Industry Exchange’s 4th Mexico Infrastructure Projects Forum in Monterrey, Mexico Jan. 16-17.

Natural gas marketers in Mexico transacted an average volume of 6.69 Bcf/d during the second half of 2018, up 35% from the 4.96 Bcf/d averaged during the corresponding 2017 period, according to the latest IPGN monthly natural gas price index published by the Comisión Reguladora de Energía (CRE).

Despite being on the cusp of a potentially record-setting Arctic blast, the natural gas futures market on Monday expressed its dissatisfaction with a mild break expected next week, selling off sharply to slip back below the $3 mark. In the spot market, the prospect of dangerously cold temperatures over the next few days helped drive hefty gains in the Midwest; the NGI Spot Gas National Avg. climbed 31.0 cents to $3.625/MMBtu.