Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Natural Gas

US EIA raises Q2 Henry Hub spot gas price forecast 15 cents

LNG | Natural Gas | Natural Gas (North American)

LNG developers jockey for relevance at Gastech

Natural Gas | Oil

Platts Wellscape P2P

Commodities | LNG | Natural Gas | NGL | Financial Services | Infrastructure & Utilities

Gas Storage Outlook Conference, 18th Annual

LNG | Natural Gas

Petronet deal endorses Tellurian business model in crowded US LNG field

US EIA raises Q2 Henry Hub spot gas price forecast 15 cents

Highlights

Market commentary recaps prior day’s spot and futures trading activity

Natural gas news, including FERC rulings and insights

Price reporting at 94 geographic locations

Platts Analytics market fundamentals supplement

NYMEX Henry Hub 36-month forward contract prices

The US Energy Information Administration raised its forecast for second-quarter spot natural gas prices and said prices for 2017 and 2018 would likely be further buoyed by added exports and rising consumption.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

While gas production levels are expected to be higher, on average, this year for the first time since 2005 after declining last year, the EIA in its April Short-Term Energy Outlook nonetheless scaled back its production estimates from the prior-month's report.

The outlook released Tuesday raised the Q2 Henry Hub natural gas spot price forecast to $3.04/MMBtu, 15 cents above the agency's estimate a month earlier.

Prices picked up in March, averaging $2.88/MMBtu, the agency said, as temperatures returned closer to seasonal norms after significantly warmer-than-normal eather in February. EIA's Q3 estimate in the April report slid 3 cents to $3.06/MMBtu.



The agency said new gas-export capabilities and growing domestic consumption would contribute to the expected rise in prices for full years 2017 and 2018, compared with 2016, when the average was estimated at $2.51/MMBtu.

For 2017, Henry Hub prices are projected to average $3.10/MMBtu, 7 cents above what was indicated in March. The forecast for 2018 stayed steady at $3.45/MMBtu.

On the supply side, EIA lowered its Q2 gas marketed production estimate 910 MMcf/d to 77.48 Bcf/d, and trimmed its Q3 projections 250 MMcf/d to 79.47 Bcf/d.

EIA also scaled back its full-year production estimates compared with the prior month's forecast, with 2017 average estimates down 610 MMcf/d to 78.32 Bcf/d and 2018 estimates 740 MMcf/d lower at 82.82 Bcf/d.

Nonetheless, the agency expects production to exceed the 2016 average of 77.31 Bcf/d, when production declined for the first time since 2005.

Turning to demand, EIA also lowered its gas consumption estimates by 490 MMcf/d to 64.84 Bcf/d in Q2 and by 660 MMcf/d to 66.17 Bcf/d in Q3.

"The amount of electricity generated from natural gas this summer is forecast to be lower than last summer, reflecting higher natural gas prices," said EIA Acting Administrator Howard Gruenspecht in a statement accompanying the report.

The agency also cut its estimates of natural gas consumption for 2017 by 310 MMcf/d to 73.34 Bcf/d, but raised its 2018 demand estimates by 690 MMcf/d to average 76.06 Bcf/d. The 2016 average was 75.13 Bcf/d, according to April's report.

Looking at working gas storage stocks, EIA noted that on March 31, typically the end of withdrawal season, levels were 15% above the five-year average, but 17% below last year's record high at the end of March. Draws were higher this winter because of lower production and higher exports, EIA said.

The agency expects exports this year to rise more than production, moving storage stocks closer to the five-year average at the start of the heating season.

"The narrowing of inventory levels to the five-year average is reflected in the forecast for rising natural gas prices," the report said.

The share of utility-scale generation from gas is expected to fall to 32% in both 2017 and 2018 from 34% in 2016, on higher expected gas prices, EIA said. The share of generation relying on coal, by contrast, would tick up to 31% in 2017 and 2018 from 30% in 2016. That shift will help drive coal production 4% higher in 2017 and up another 2% in 2018, the outlook predicted.

In total, generation from utility-scale plants is projected to dip 0.7% in 2017, then rise 1.7% in 2018, the report said. Sizable growth is seen for utility-scale solar capacity, which EIA expects to rise 44% from the end of 2016 to 31 GW at the end of 2018, reaching 1% of total capacity.

--Maya Weber, maya.weber@spglobal.com

--Edited by Valarie Jackson, valarie.jackson@spglobal.com