Record-high gas production, flat need, and high stocks led to U.S. benchmark gas rates balancing $2.57 per million British thermal systems (MMBtu) in 2023, down by around 62% compared to the 2022 average, the U.S. Energy Info Administration (EIA) stated on Thursday.
The month-to-month average Henry Center rate was listed below $3.00 per MMBtu in on a monthly basis in 2015, other than January, with the most affordable month-to-month average in Might at $2.19 per MMBtu, according to the information from Refinitiv Eikon mentioned by the EIA.
In the very first half of 2023, the benchmark U.S. gas rates dropped by 34%, dragged down by record production, high stocks, and reasonably moderate winter season temperature levels. The typical month-to-month area gas rate at the U.S. standard Henry Center dipped by 34%, or by $1.12 per MMBtu, to $2.18 per MMBtu in between January and June.
For the entire year 2023, the main motorist of the plunge in the typical Henry Center rates was the record-high gas production in the United States as the increase in output outmatched development in usage.
The EIA approximates that U.S. dry gas production balanced a record-high 104 billion cubic feet daily (Bcf/d) in 2023, up by 4% compared to the 2022 yearly average.
At the very same time, gas need increased by 3% in 2023 year-on-year. Greater gas exports and a minor boost in gas taken in for electrical power generation balanced out lower domestic and business sector usage. U.S. LNG exports increased by 12% in 2023 and gas exports by pipeline increased by 9% every year, according to EIA price quotes.
Higher-than-average stocks at the start of the 2023/2024 winter season heating season and record-high U.S. gas production have actually been weighing on gas rates in current weeks.
The United States entered this winter season heating season with the greatest gas in storage because 2020, the EIA stated in December.
By Tom Kool for Oilprice.com