The U.S. Energy Information Administration has reduced its forecast for Henry Hub natural gas spot prices this year as LNG exports produced from shale gas continue to rise.
To remind, Henry Hub-priced US LNG exports received a boost last week as the Dominion Cove facility, the second US facility to produce LNG from shale gas, shipped its first cargo.
In its latest Short-Term Energy Outlook released on Tuesday, the agency said Henry Hub gas prices would average $2.99 per million British thermal units in 2018 and $3.07/MMBtu in 2019.
The 2018 estimate is down 21 cents as compared to forecasts in EIA’s previous short-term outlook.
In February, the Henry Hub price averaged $2.66/MMBtu, down $1.03/MMBtu from January.
Winter weather moderated in February after extremely cold temperatures in much of the country during the first half of January.
U.S. heating degree days were an estimated 17% lower than the 10-year average for February, which contributed to lower consumption and prices, EIA said.
EIA also said it expects U.S. dry natural gas production, which averaged 73.6 billion cubic feet per day (Bcf/d) in 2017, to continue to rise to record levels.
The agency expects natural gas production to average 81.7 Bcf/d in 2018.
That level would be 8.1 Bcf/d higher than the 2017 level and the highest annual average growth on record, it said.
EIA added it expects natural gas production to continue its upward trend in 2019, with forecast growth of 1.0 Bcf/d.
LNG World News Staff