BAKU, Azerbaijan, April 10. The US Energy Information Administration (EIA) expects a slight dip in US dry natural gas production from April to October, averaging around 103 billion cubic feet per day (Bcf/d), Trend reports.
According to the agency's data, this is a tad lower than last year's average of 104 Bcf/d for the same period.
During this time frame, the EIA forecasts that about 38 Bcf/d of natural gas will be used for generating electricity, similar to last year's levels. However, as the agency noted, if production drops more than anticipated or if there's higher demand for electricity due to hotter summers, it could lead to lower inventories and potentially higher prices.
Meanwhile, as of the end of March, US natural gas storage inventories were 39 percent above the five-year average, largely due to a surplus at the start of the winter heating season and a mild winter resulting in lower-than-average consumption in residential and commercial sectors. This surplus kept Henry Hub prices low in the first quarter of 2024, averaging less than $2 per million British thermal units (MMBtu).
Looking ahead, the EIA predicts that natural gas prices will remain relatively low, averaging less than $2.00/MMBtu in the second quarter of 2024 and around $2.20/MMBtu for the entire year.
Despite expecting lower production in the second and third quarters of 2024 compared to the first quarter, the EIA still anticipates ending the injection season with a substantial 4,120 Bcf of natural gas in storage, which is 10 percent more than the five-year average and the highest on record.
