The U.S. Energy Information Administration expects the 2018 Henry Hub spot natural gas price to match the 2017 average at $2.99/MMBtu before rising to $3.08/MMBtu in 2019.
In its latest "Short-Term Energy Outlook," the agency said the 2018 summer injection season started April 27, four weeks later than in 2017 as the result of the coldest April in 21 years. Working natural gas stocks as of June 1 were 1,817 Bcf, which was 31% lower than the year-ago level and 22% lower than the five-year average for that time of year.
The large working natural gas inventory deficit and the late start to the storage injection season contributed to higher Henry Hub prices despite record production growth. Average May dry natural gas production of 81.3 Bcf/d was 13% above the same month a year earlier, the EIA said.
The EIA expects dry natural gas production will increase 10% from 73.57 Bcf/d in 2017 to 81.20 Bcf/d in 2018 and will jump 3% to 83.78 Bcf/d in 2019.
On the consumption side, the EIA expects natural gas consumption will climb from 74.22 Bcf/d in 2017 to 79.57 Bcf/d in 2018, before edging back to 79.41 Bcf/d in 2019.
