In its short-term energy outlook released last week, U.S. Energy Information Administration said U.S. benchmark Henry Hub spot price for natural gas is forecast to stay below $2 per million British thermal units in second quarter. The price averaged an inflation-adjusted low of $1.72 per MMBtu in February. EIA said March 12, “We expect natural gas inventories will remain high relative to the five-year average as the U.S. enters the … season when there is typically less U.S. natural gas consumption.” Annual average Henry Hub price for 2024 is about $2.30/MMBtu – 14 percent lower than forecast last month.
EIA said U.S. dry natural gas production increased to 104 Bcfd in February after declining to 102 Bcfd in January because of weather-related outages. EIA expected production to remain at that level in March and then decline slightly through the remainder of 2024 as producers curtail production because of low prices. EIA expects production to increase in early 2025 because of higher prices and increased demand for LNG. Most production growth will come from Permian Basin, Appalachia and Haynesville.