Enagas revises up December gas demand forecast

Spanish gas system operator Enagas has revised up its consumption forecast for December, owing to stronger expected demand from households and industry.

Domestic consumption will amount to 1.27 TWh/d, according to the latest forecast for December released today. In contrast, a few weeks ago, Enagas cut its predictions for overall consumption to 1.21 TWh/d for next month, down from 1.24 TWh/d in a previous forecast, owing to lighter forecast conventional use.

Notably, all of Enagas' predictions for December so far have been lower than the expected average for November, the latest of which was 1.33 TWh/d. But forecasts have also been squarely above the three-year December average of 1.13 TWh/d.

Enagas provided no explanation for its revisions, but weather could have played a central role. Models by Spanish weather agency Aemet suggest a 45pc likelihood that temperatures on most of the mainland and the Canary Islands will exceed 20-year averages in November-January. And a near-term forecast released by the agency late last week pointed to the potential for colder-than-average weather on 22 November-12 December.

In contrast, around a month ago, Aemet had forecast up to a 70pc chance of above-average temperatures for December-January, which could result in limited residential consumption.

Stronger LNG nominations

The preliminary December schedule shows LNG playing a crucial role in maintaining supply next month.

The schedule shows 32 LNG cargoes arriving, 4.3mn m³ of LNG unloadings at the country's six major terminals and 804 GWh/d of sendout, leaving aggregate stocks at 18TWh at the start of January.

This could represent a step up from November, the latest schedule for which showed 27 cargoes, with 3.5mn m³ of unloaded LNG, 767 GWh/d of regasification and stocks totalling 15.7TWh at the beginning of December.

Nominations received by Enagas showed underground storage levels slipping next month, with companies withdrawing a small amount each day and leaving a total of 23.1TWh, the bulk of which is comprised of the state-controlled strategic reserve.

If that happens, underground stocks at the start of January would be the lowest on record since 2019.

By Jeff Kuntz