U.S. natural gas prices for February at the Henry Hub benchmark in Louisiana slipped below levels seen during the same month a year ago as production rose to a record high.
That price decline occurred despite near normal temperatures and heating demand in February2018 compared with much warmer than normal weather and low heating demand during the same monthin 2017.
Next-day gas prices averaged $2.67 per million British thermal units (mmBtu) in February2018. That compared with $2.82 during the same month in 2017 and a five-year (2013-2017) averageof $3.38.
Average gas production in the lower 48 U.S. states jumped to an all-time high of 77.41billion cubic feet per day in February from 75.51 bcfd in January. That topped the previousrecord high of 77.38 bcfd in December and compared with an average of 70.74 bcfd in February2017, according to Reuters data.
Heating degree days (HDD) averaged a near normal 701 in February 2018. That compared withjust 548 HDDs during the same month in 2017 and a 10-year average for the month of 718,according to federal data.
HDDs measure the number of degrees a day’s average temperature is below 65 Fahrenheit (18Celsius). The measure is used to estimate demand to heat homes and businesses.
In 2017, annual gas prices at the Henry Hub averaged $2.96 per mmBtu, also the highest since2014. That compared with an average of $2.49 in 2016, which was the lowest since 1999, and afive-year average of $3.18.