UPDATE 1-US natgas little changed as rising inventory offset cooling demand

(Updates first paragraph, settlement price in graph 2, and Baker Hughes weekly report in paragraph 10) Aug 11 (Reuters) - U.S. natural gas futures were little changed on Friday, as rising inventory offset support from forecasts for hot weather and higher cooling demand. Front-month gas futures for September delivery on the New York Mercantile Exchange settled 0.7 cent, or 0.3%, higher at $2.77 per million British thermal units (mmBtu) after dropping 6.6% on Thursday. However, the contract was up 7.5% for the week. "The biggest factor is that our production is still going strong. The EIA storage report certainly has shown that the production is strong enough to meet the domestic demand despite the abnormally high temperatures for the last week," said Zhen​ Zhu, managing consultant at C.H. Guernsey and Co in Oklahoma City. The U.S. Energy Information Administration (EIA) reported on Thursday that utilities added 29 billion cubic feet (bcf) of gas into storage during the week ended Aug 4. That was slightly bigger than the 25-bcf build analysts forecast in a Reuters poll, and lifted stockpiles to 3.030 trillion cubic feet (tcf), 11% above the five-year average. Power demand in Texas hit an all-time high on Thursday for the third time this week and will likely break that record again as homes and businesses keep their air conditioners cranked up during the lingering heat wave, according to forecasts by the Electric Reliability Council of Texas (ERCOT), the state's power grid operator. Extreme heat boosts the amount of gas burned to produce power for cooling, especially in Texas, which gets most of its electricity from gas-fired plants. In 2022, about 49% of the state's power came from gas-fired plants, with most of the rest from wind (22%), coal (16%), nuclear (8%) and solar (4%), federal energy data showed. Meteorologists forecast the weather in the lower 48 states will remain hotter than normal through at least Aug. 26. Data provider Refinitiv forecast U.S. gas demand, including exports, would rise from 103.0 billion cubic feet per day (bcfd) this week to 104.5 bcfd next week as power generators burn more of the fuel and exports rise. The forecast for next week was lower than Refinitiv's outlook on Thursday. U.S. energy firms this week cut the number of oil and natural gas rigs operating, which is an early indicator of future output, for a fifth week in a row, energy services firm Baker Hughes said in its weekly report. Refinitiv said average gas output in the U.S. lower 48 states was 101.9 bcfd so far in August, nearly the same as the 101.8 bcfd in July. That compares with a monthly record of 102.2 bcfd in May. Gas flows to the seven big U.S. LNG export plants have fallen from an average of 12.7 bcfd in July to 12.3 bcfd so far in August, mainly due to reductions at Venture Global LNG's Calcasieu facility in Louisiana. That compares with a monthly record of 14.0 bcfd in April. The U.S. is on track to become the world's biggest LNG supplier in 2023 - ahead of recent leaders Australia and Qatar - as higher global prices feed demand for U.S. exports due to supply disruptions and sanctions linked to the war in Ukraine. Dutch and British wholesale gas prices mostly fell as the prospect of strikes at Australian LNG facilities appeared to ease after companies involved began talks to avert industrial action. "The prospect of US LNG cancellations seems more remote, especially if risks of strikes in Australian LNG facilities materialize," Goldman Sachs said in a note. In 2022, roughly 69%, or 7.2 bcfd, of U.S. LNG exports went to Europe as shippers diverted cargoes from Asia to get higher prices. In 2021, when prices in Asia were higher, just 35%, or about 3.3 bcfd, of U.S. LNG exports went to Europe. With the return of higher gas prices in Asia this year, analysts said they expect U.S. LNG exports to Asia will increase. Just 19%, or 2.1 bcfd, of U.S. LNG exports went to Asia during the first half of 2023, while 70%, or 8.0 bcfd, went to Europe. Week ended Week ended Year ago Five-year Aug 11 Aug 4 Aug 11 average Forecast Actual Aug 11 U.S. weekly natgas storage change (bcf): 38 29 21 41 U.S. total natgas in storage (bcf): 3,068 3,030 2,516 2,766 U.S. total storage versus 5-year average 10.9% 11.2% Global Gas Benchmark Futures ($ per mmBtu) Current Day Prior Day This Month Prior Year Five Year Last Year Average Average 2022 (2017-2021) Henry Hub 2.77 2.76 8.78 6.54 2.89 Title Transfer Facility (TTF) 11.58 12.82 69.68 40.50 7.49 Japan Korea Marker (JKM) 11.09 11.05 53.22 34.11 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 1 1 1 4 5 U.S. GFS CDDs 248 246 193 193 186 U.S. GFS TDDs 249 247 194 197 191 Refinitiv U.S. Weekly GFS Supply and Demand Forecasts Prior Week Current Next Week Five-Year Week Average For Month U.S. Supply (bcfd) U.S. Lower 48 Dry Production 102.3 101.9 101.6 92.0 U.S. Imports from Canada 7.4 7.2 7.4 8.1 U.S. LNG Imports 0.0 0.0 0.0 0.1 Total U.S. Supply 109.7 109.1 109.0 100.8 U.S. Demand (bcfd) U.S. Exports to Canada 1.7 1.6 1.6 2.5 U.S. Exports to Mexico 6.4 6.6 6.6 5.6 U.S. LNG Exports 12.7 12.3 12.7 6.1 U.S. Commercial 4.4 4.4 4.4 4.5 U.S. Residential 3.5 3.5 3.5 3.4 U.S. Power Plant 47.4 45.9 46.9 41.2 U.S. Industrial 21.3 21.3 21.4 21.5 U.S. Plant Fuel 5.1 5.0 5.0 5.0 U.S. Pipe Distribution 2.2 2.2 2.2 2.3 U.S. Vehicle Fuel 0.1 0.1 0.1 0.1 Total U.S. Consumption 84.0 82.5 83.6 78.0 Total U.S. Demand 104.8 103.0 104.5 92.2 U.S. weekly power generation percent by fuel - EIA Week ended Week ended Week ended Week ended Week ended Aug 11 Aug 4 Jul 28 Jul 21 Jul 14 Wind 7 7 7 7 7 Solar 4 4 4 4 4 Hydro 5 5 5 6 6 Other 2 2 2 2 2 Petroleum 0 0 0 0 0 Natural Gas 45 45 45 46 45 Coal 19 20 20 19 19 Nuclear 17 17 16 17 17 SNL U.S. Natural Gas Next-Day Prices ($ per mmBtu) Hub Current Day Prior Day Henry Hub 2.83 2.92 Transco Z6 New York 1.30 1.42 PG&E Citygate 5.59 5.70 Eastern Gas (old Dominion South) 1.23 1.37 Chicago Citygate 2.61 2.63 Algonquin Citygate 1.39 1.52 SoCal Citygate 4.87 5.00 Waha Hub 2.61 2.72 AECO 2.93 2.91 SNL U.S. Power Next-Day Prices ($ per megawatt-hour) Hub Current Day Prior Day New England 29.25 25.00 PJM West 37.00 35.25 Ercot North 227.50 643.00 Mid C 64.25 70.00 Palo Verde 53.50 48.25 SP-15 53.75 54.50 (Reporting by Harshit Verma in Bengaluru; Editing by Kirsten Donovan and Jonathan Oatis)