The U.S. Power Data Administration (EIA) has raised its Henry Hub spot worth forecast for 4Q2023 to $3.03/MMBtu, although the company spotlighted storage ranges that stay on the excessive aspect of historic norms.
EIA in its newest Brief-Time period Power Outlook modeled a Henry Hub spot worth of $3.31 for 1Q2024, which might examine bullishly to 1Q2023 costs of $2.65. Nevertheless, going again to the beginning of final winter, the nationwide benchmark noticed costs of $5.55 through the fourth quarter of 2022, EIA information present.
In final month’s STEO, EIA predicted a mean Henry Hub spot worth of $2.95 for 4Q2023.
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The company forecast complete home pure gasoline storage of three,854 Bcf by the tip of October, a 6% buffer versus the five-year common. That’s down from a 19% year-on-five-year surplus firstly of the injection season.
Nonetheless, EIA famous that its forecast would see “essentially the most U.S. pure gasoline inventories getting into the winter heating season since 2020 and the fourth-most prior to now 10 years.”
In the meantime, alongside an up to date international vitality forecast additionally issued Wednesday that confirmed a continued rise in U.S. pure gasoline exports within the a long time forward, the newest STEO predicted a brand new annual report for U.S. exports in 2023. Additional, home pure gasoline exports ought to proceed to rise in 2024, the company mentioned.
Driving an anticipated 20% 12 months/12 months enhance in internet U.S. pure gasoline exports in 2023 has been development in LNG exports and pipeline exports to Mexico, in line with EIA.
The USA exported extra liquefied pure gasoline “than every other nation within the first half of 2023, averaging 11.6 Bcf/d, 10% greater than the common for all of 2022,” researchers mentioned. “After a decline in 3Q2023, we forecast LNG exports to extend throughout 4Q2023 and proceed rising into 2024, averaging 12.7 Bcf/d for the primary 9 months of 2024.”
New export capability will then enter service and push LNG exports towards the 15.0 Bcf/d mark late subsequent 12 months, the company mentioned.
This comes as pipeline exports, going to Mexico in addition to to Canada, are on monitor to extend 9.0% 12 months/12 months to a mean of 9.0 Bcf/d in 2023, in line with the newest STEO.
“Pipeline exports to Mexico reached a brand new report excessive in June and have remained excessive all through the summer time,” EIA mentioned. “We anticipate pure gasoline pipeline exports to Mexico to proceed rising as pipeline initiatives in Mexico are accomplished and demand in Mexico’s electrical energy sector rises.”
As for imports, expectations for hotter winter climate within the northern United States and fewer want for Canadian provides led EIA to forecast a 6% decline in U.S. pure gasoline imports for 2023 versus 2022 ranges.
On the subject of winter heating, pure gasoline shoppers ought to get pleasure from decreased prices within the upcoming winter, in line with the company.
EIA mentioned it expects U.S. households that use pure gasoline — in addition to electrical energy and propane — for heating to spend much less this winter. Conversely, households utilizing heating oil are projected to spend barely extra.
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