U.S. spot natural gas prices in June at the Henry Hub benchmark in Louisiana dropped to their lowest for the month since 1999 as record production so far this year allowed utilities to inject huge amounts of gas into storage.
Next-day prices averaged $2.40 per million British thermal units (mmBtu) in June. That compares with an average of $2.97 in June 2018 and a five-year (2014-2018) average of $3.16. In June 1999, prices averaged $2.29.
So far in 2019, next-day gas prices have averaged $2.73 per mmBtu. That compares with an average of $3.15 for all of 2018, the most for a year since 2014, and a five-year average of $3.13.
Production in the Lower 48 U.S. states averaged a near-record monthly high of 89.33 billion cubic feet per day (bcfd) during June. That compares with 80.96 bcfd in June 2018 and a five-year (2014-2018) average of 73.19 bcfd for the month, according to financial data provider Refinitiv. The all-time monthly high was 89.34 bcfd in April.
One billion cubic feet of gas is enough gas to supply about 5 million U.S. homes for a day.
Utilities used that extra gas to cut the storage deficit from as much as 33% below normal in March to just 7% below normal during the week ended June 21. By the end of the summer injection season at the end of October, analysts expect the amount of gas in storage will reach a near-normal 3.7 trillion cubic feet (tcf). There is currently about 2.3 tcf of gas in storage.