GIA contract prices fall across the board on loosened fundamentals

The Platts-ICE Gas Indices Americas South contract saw the largest decline over the week ended March 20, averaging $1.38/MMBtu representing a 55-cent decline from the prior week's average.

Prices collapsed in the Permian, resulting in the steep decline from the week before; however, regional fundamentals also loosened. Total Southeast and Texas demand fell by 642 MMcf, averaging 45.42 Bcf/d, while production remained relatively flat over the same period.

The GIA Northeast contract fell by 37 cents over the same period, averaging $3.20/MMBtu. Total Northeast demand fell by 4.06 Bcf, down to 21.22 Bcf/d as population-weighted average temperatures rose by around 6 degrees Fahrenheit. Moreover, Northeast production expanded by 591 MMcf, up to 36.62 Bcf/d over the same period, softening regional fundamentals further.

Similarly, the GIA Midwest contract fell by 27 cents, down to $3.38/MMBtu as total Midcontinent demand fell by 2.09 Bcf, down to an average of 16.63 Bcf/d over the week ended March 20. Warmer weather was also the primary driver of demand losses, as temps rose by about 4 F.

The GIA West contract fell by just 10 cents from the week prior, averaging $2.69/MMBtu over the same period. Total West demand grew by 647 MMcf up to 14.79 Bcf/d.

However, falling prices in Western Canada pulled the contact lower over the week ended March 20. Finally, the GIA North America contract fell by 33 cents, down to $2.62/MMBtu over the week ended March 20, as total US demand slid 6.1 Bcf down to 97.52 Bcf/d.