U.S. natural gas production will decline in 2024 while demand will rise to a record high, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO) on Tuesday.
EIA projected dry gas production will ease from a record 103.8 billion cubic feet per day (bcfd) in 2023 to 103.5 bcfd in 2024 as several producers reduce drilling activities after average monthly spot gas prices at the Henry Hub benchmark fell to a 32-year low in March.
In 2025, EIA projected output would rise to 104.6 bcfd.
The agency also projected domestic gas consumption would rise from a record 89.1 bcfd in 2023 to 90.1 bcfd in 2024 before easing back to 89.1 bcfd in 2025.
If the projections are correct, 2024 would be the first time output declines since 2020, when the COVID-19 pandemic cut demand for the fuel. It would also be the first time demand increases for four years in a row since 2016.
The latest projections for 2024 were higher than EIA’s forecasts in September of 103.4 bcfd for supply and 89.9 bcfd for consumption.
The agency forecast average U.S. liquefied natural gas (LNG) exports would reach 12.1 bcfd in 2024 and 13.8 bcfd in 2025, up from a record 11.9 bcfd in 2023.
The agency projected U.S. coal production would fall from 577.5 million short tons in 2023 to 510.0 million tons in 2024, which would be the lowest level since 1964, and 484.6 million tons in 2025, which would be the lowest since 1963, as gas and renewable sources of power displace coal-fired plants.
EIA projected carbon dioxide (CO2) emissions from fossil fuels would ease from 4.791 billion metric tons in 2023 to 4.777 billion metric tons in 2024 as oil and coal use decrease, before edging up to 4.794 billion metric tons in 2025 as petroleum and coal use increase again.
That compares with carbon emissions of 4.584 billion metric tons in 2020, the lowest level since 1983, when the pandemic sapped demand for energy.
(Reporting by Scott DiSavino; Editing by Richard Chang and David Gregorio)