The U.S. Vitality Info Administration (EIA) has revealed its newest Henry Hub pure gasoline spot worth forecast for 2024 and 2025 in its November brief time period vitality outlook (STEO), which was launched lately.
Based on its newest STEO, the EIA now sees the Henry Hub spot worth averaging $2.17 per million British thermal items (MMBtu) this 12 months and $2.90 per MMBtu subsequent 12 months. In its earlier STEO, the EIA projected that the Henry Hub spot worth would common $2.28 per MMBtu in 2024 and $3.06 per MMBtu in 2025.
In its November STEO, the EIA forecast that the commodity would are available at $2.37 per MMBtu within the fourth quarter of 2024, $2.84 per MMBtu within the first quarter of 2025, $2.45 per MMBtu within the second quarter, $3.01 per MMBtu within the third quarter, and $3.29 per MMBtu within the fourth quarter.
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In its October STEO, the EIA projected that the Henry Hub spot worth would common $2.81 per MMBtu within the fourth quarter of 2024, $3.16 per MMBtu within the first quarter of 2025, $2.59 per MMBtu within the second quarter, $3.13 per MMBtu within the third quarter, and $3.35 per MMBtu within the fourth quarter.
“U.S. pure gasoline costs fell in October as pure gasoline consumption declined from September, manufacturing remained comparatively unchanged, and storage inventories ended the month six % above the five-year (2019–2023) common,” the EIA stated in its newest STEO.
“The U.S. benchmark Henry Hub pure gasoline spot worth averaged $2.20 per MMBtu in October, 4 % decrease than the September common of $2.28 per MMBtu,” it added.
Within the November STEO, the EIA outlined that October’s pure gasoline demand drop was “led by a 14 % (six billion cubic ft per day) decline in consumption within the electrical energy sector, offsetting a rise in consumption within the residential and industrial sectors”.
“Regardless that consumption within the electrical energy sector was down month over month in October, it was 13 % increased than the month’s five-year common,” the EIA said.
The group stated within the STEO that prime energy sector demand for pure gasoline mirrored decrease pure gasoline costs and better air-conditioning use in elements of america experiencing prolonged summer-like circumstances.
“We anticipate the Henry Hub worth to rise within the subsequent three months and to common greater than $2.80 per MMBtu within the first quarter of 2025,” the EIA highlighted within the November STEO.
“We anticipate costs to common $2.90 per MMBtu for all of 2025, or 33 % increased than the 2024 common of $2.20 per MMBtu, primarily due to elevated liquefied pure gasoline (LNG) exports,” it added.
“Our forecast consists of LNG exports rising by practically two billion cubic ft per day subsequent 12 months with continued sturdy worldwide demand for LNG as export capability expands,” it continued.
41% 12 months on 12 months Progress Projection
A BMI report despatched to Rigzone by the Fitch Group this morning confirmed that BMI expects the Henry Hub worth to common $2.4 per MMBtu in 2024, $3.4 per MMBtu in 2025, $3.8 per MMBtu throughout 2026 and 2027, and $4.0 per MMBtu in 2028.
A Bloomberg Consensus included in that report projected that the commodity will common $2.4 per MMBtu this 12 months, $3.4 per MMBtu subsequent 12 months, $3.7 per MMBtu in 2026, $3.8 per MMBtu in 2027, and $4.0 per MMBtu in 2028.
“We keep our Henry Hub worth forecast this quarter, anticipating a considerable, 41 % 12 months on 12 months development in common costs to $3.4 MMBtu in 2025, from $2.4 MMBtu in 2024,” BMI analysts said within the report.
“This development can be primarily pushed by rising demand for pure gasoline from the U.S. LNG sector, as we anticipate three new terminals to begin operations between now and the top of 2025,” they added.
“We additionally anticipate weaker web gasoline imports from Canada which is able to additional tighten the U.S. market,” they continued.
Within the report, the analysts warned that the upside is about to be weakened by accelerating pure gasoline manufacturing development in america.
“That stated, we acknowledge rising draw back dangers to the 2025 worth forecast stemming from draw back dangers to the home and Mexican pure gasoline demand and upside dangers to pure gasoline manufacturing stemming from improved sentiment within the U.S. upstream market within the mild of the election victory of the previous President Donald Trump,” the analysts famous.
“His insurance policies might additionally influence our forecasts past 2025, elevating dangers to our view,” they added.
In a analysis word despatched to Rigzone final Friday by the JPM Commodities Analysis staff, J.P. Morgan projected that the U.S. pure gasoline Henry Hub worth will common $2.37 per MMBtu in 2024 and $3.50 per MMBtu in 2025.
The corporate sees the commodity averaging $2.75 per MMBtu within the fourth quarter of 2024, $3.55 per MMBtu within the first quarter of 2025, $3.10 per MMBtu within the second quarter, $3.55 per MMBtu within the third quarter, and $3.80 per MMBtu within the fourth quarter, the word highlighted.
A report despatched to Rigzone final Tuesday by Customary Chartered Financial institution Commodities Analysis Head Paul Horsnell confirmed that the corporate expects the close by future NYMEX foundation Henry Hub worth to common $3.20 per MMBtu within the first quarter of 2025, $3.50 per MMBtu throughout the second and third quarters, $2.80 per MMBtu within the fourth quarter, and $3.25 per MMBtu general subsequent 12 months.
Primary NatGas Theme? Storage
In an unique interview with Rigzone, Frederick J. Lawrence, the ex-Impartial Petroleum Affiliation of America (IPAA) Chief Economist, stated storage was the primary pure gasoline theme by final week’s finish however highlighted that “there are some encouraging demand alerts associated to demand, climate, and LNG”.
“Pure gasoline costs dropped towards the top of final week following a bearish EIA storage report that confirmed a 42 billion cubic foot web improve for the week ending November 8,” Lawrence informed Rigzone, noting that storage is comparatively comfy at this level within the 12 months after a spate of hotter than regular climate throughout many of the United States.
“As per the EIA report, pure gasoline storage was 158 billion cubic ft increased than final 12 months right now and 228 billion cubic ft above the five-year common,” he added.
Lawrence highlighted to Rigzone that the EIA pure gasoline weekly report for the week ending November 13 “confirmed that gasoline demand was up 4.9 % final week with residential and industrial demand rising 23.8 % in comparison with the earlier week”.
The ex-IPAA Chief Economist additionally famous that the EIA pure gasoline weekly report confirmed that pure gasoline exports rose 1.4 billion cubic ft per day.
“Larger worldwide gasoline costs resulted from colder climate in Northeast Asia and Europe along with provide danger associated to Russian gasoline flows to Austria,” Lawrence highlighted.
Lawrence additionally informed Rigzone that, within the U.S. market, “a few of the election-related influence on sure commodities and fairness segments light by the top of the week with the market extra involved with warning on future rate of interest motion”.
In a separate unique interview with Rigzone, Jim Krane, a Analysis Fellow at Rice College’s Baker Institute, stated merchants obtained a shock final week with extra gasoline in storage than anticipated.
“Because the Permian oil manufacturing will get gassier over time, we could get extra such surprises,” Krane warned.
To contact the creator, e mail andreas.exarheas@rigzone.com
