EIA Flags Below Average U.S. NatGas Stocks Going into Winter
(Reuters) — The U.S. Energy Information Administration (EIA) on Wednesday said high level of natural gas exports this year, coupled with relatively flat output have led to below average injection of the fuel into storage going into the winter heating season.
Inventories of gas, used to heat homes and business, have only grown by 960 billion cubic feet (bcf) so far this injection season between April 1 and Oct. 31, which is 14% lower than the five-year average stock build during the April-July period, the EIA said in a release.
A combination of new liquefied natural gas (LNG) export capacity and rising natgas and LNG prices globally have pushed U.S. exports of LNG to record levels so far this year, the EIA said.
The agency forecast U.S. LNG exports to average 9.5 bcfd for the entire year, a jump from the 6.5 bcfd in 2020 when the COVID-19 pandemic took a toll on demand.
Similarly, natgas exports via pipeline are projected to average 8.8 bcfd in 2021, versus the 7.9 bcfd last year, the EIA said.
In its August 2021 Short-Term Energy Outlook, the EIA forecast inventories to reach 3,592 bcf by Nov. 1, which was 159 bcf below the previous five-year (2016–2020) average.
"In May and June, U.S. consumption of natural gas increased 4.2 bcf per day, or 6.2%, because of higher electric power sector consumption in response to the hot weather," with June 2021 being the hottest on record, the agency said.
U.S. natural gas futures vaulted to 30-month highs in June as global gas prices soared. Adding to this was a heatwave that shattered temperature records in the U.S. Southwest, with parts of the country still reeling from the sweltering heat.
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