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US Summer Natural Gas Prices on Track to Be Lowest in More Than 20 Years - EIA

Gasoil News - Published on Mon, 22 Jul 2019

Image Source: EIA
In its July 2019 Short-Term Energy Outlook, the US Energy Information Administration forecasts Henry Hub natural gas spot prices for June, July, and August this year will average USD 2.37 per million British thermal units. If realized, this price would be the lowest summer average Henry Hub natural gas price since 1998. EIA expects Henry Hub natural gas prices will be 55 cents/MMBtu, about 19%, lower than last summer’s average. In the July STEO, EIA revised its forecast for 2019 Henry Hub natural gas prices down from the June STEO following three consecutive months of price declines. Prices in June averaged USD 2.40 per million British thermal units and have declined by 19% since March.

Spot prices at key trading hubs across the country have traded close to the Henry Hub basis. Prices at the Transcontinental Pipeline Zone 6 trading point for New York City and the Chicago Citygate were both at USD 2.12 per million British thermal units, the lowest June average price and a decrease of 25% and 23%, respectively, from June 2018. The PG&E Citygate near San Francisco had the highest June average price at USD 2.59 per million British thermal units, a 14% decrease from last June.

The recent natural gas price declines reflect relatively mild weather for the start of summer that led to lower than expected natural gas-fired electricity generation, which allowed natural gas inventory injections to outpace the previous five-year average rate. Between April and June, cumulative net injections into underground storage fields have exceeded the five-year average by 41%, reducing the current five-year average deficit by more than 300 billion cubic feet.

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Posted By : Ratan Singh on Mon, 22 Jul 2019
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