Higher US natural gas prices positive for production gains in ’17, ’18: EIA

7 Jun 2017   Prices, Shale Gas

While projections for higher natural gas prices are expected to reduce gas’ share in the generation mix, the subsequent increase in cash flow to gas producers is seen boosting gas production, reversing last year’s drop in output, the first annual decline the industry had seen in 11 years, the US Energy Information Administration said Tuesday in its monthly outlook. The agency, in its June Short-Term Energy Outlook, put second-quarter Henry Hub natural gas spot prices at $3.14/MMBtu, down 2 cents from its May estimate. The Q3 forecast dipped 1 cent from the prior month to $3.20/MMBtu. The agency put gas prices for full-year 2017 at an average $3.16/MMBtu, a 1-cent drop from the prior month’s estimate, and forecast 2018 prices to average $3.41/MMBtu, lowering its estimate from May by 2 cents. By comparison, prices averaged $2.51/MMBtu in 2016. “The amount of US electricity supplies from natural-gas fired generation is […]

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