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US spot natural gas prices resume gains in September except in Northeast

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August

US spot natural gas prices resume gains in September except in Northeast

After stalling in the prior month, spot natural gas pricesresumed their march higher in September in all parts of the U.S. but theNortheast.

Average spot prices in the Northeast declined 9.5% versus theprior month and 7.5% versus the prior year, while the Gulf Coast saw pricesjump 11.4% year over year to $2.847/MMBtu.

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Increased power-sector demand for natural gas led to below-averagestorage builds during the month. According to the U.S. National Oceanic andAtmospheric Administration, cooling degree days were 55% above normal and 7%above the prior year, and during the three weeks ended Sept. 23, net injectionsinto storage were 34.5% below the five-year average, according to data from theU.S. Energy Information Administration.

Meanwhile, the EIA estimates shale gas production willdecline at aslower rate throughOctober. In its latest drilling productivity report, the government agencyestimated that Marcellus production would average 17.81 Bcf/d in September, a0.2% decline versus the prior month, before declining another 0.1% in Octoberto 17.78 Bcf/d. Those figures represent a 5.1% and 7.2% respectiveyear-over-year increase in output.

In spite of increased natural gas demand for electricity andelevated shale production year over year, the largest declines in natural gasprices were seen along the demand serving portion of . At $1.427/MMBtu and $1.431/MMBtu, respectively, average spotprices at Transco Zone 6 Non-NY and Transco Zone 6 NY were 38% and 37.2% belowthe year-ago level, respectively. Meanwhile, average spot prices at Leidydeclined by only 9.9% over the same period.

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Market prices and included industry data are current asof the time of publication and are subject to change. For more detailed marketdata, including powerand naturalgas index prices, as well as forwardsand futures,visit our Commodities Pages.