The US natural gas market is expected to see supply growth outpace demand this winter despite rising LNG exports, the Natural Gas Supply Association, an industry group, said in its winter outlook on Thursday.
US dry gas production is expected to average 112.5 billion cubic feet per day (bcf/d) this winter, up roughly 2.5 bcf/d from last year and roughly 7 bcf/d above the three-winter average, NGSA said.
Here are some details from the report:
* With this year’s projections based on normal winter weather, total demand is forecast to grow 1.6 bcf/dc, compared to year-ago levels.
* U.S. natural gas storage is projected to start the Winter 2026-2027 heating season near 3.85 trillion cubic feet, essentially close to last summer’s end-of injection level.
* End-of-withdrawal inventories are projected near 1.95 TCF as of end-March 2027, above the level seen in most of the last five winters, the outlook added.
* Henry Hub forwards are pricing this winter at an average of $3.43 per million british thermal units (MMBtu), down sharply from the $4.51/MMBtu realized last winter, as ample storage and production keep the domestic market well supplied, even as global benchmarks stay elevated on the Strait of Hormuz-driven supply disruption.
* Residential, commercial, and industrial usage are expected to remain steady under normal weather assumptions, leaving LNG exports and power burn as the primary drivers of total winter demand.
(Reporting by Sumit Saha in Bengaluru; Editing by David Gregorio)