Today the EIA put out its September Natural Gas Monthly, with data through July 2014. In the report, the U.S.’s July dry gas production of 70.4 Bcf/day set the record for “the highest ever for any month,” the EIA said.
But total consumption of natural gas fell short of production by almost 10 Bcf/day in July, which was the lowest consumption for the month of July since 2010. The EIA also reported that electric power deliveries for July (840 Bcf or 27.1 Bcf/day) were down 7.3% from July 2013, and are the lowest for the month since 2009.
The cooler summer resulted in less use of air conditioning, reducing electricity demand and requiring less gas to fuel the generators. Thus, the surpluses grow. But what is to come for winter? Calling it an “arctic blast with above normal snowfall,” The Old Farmer’s Almanac earlier predicted a super-cold winter with frigid temperatures and plenty of snow for the eastern two-thirds of the country flanked by warmer than average temps for the western U.S.
“Traders have frequently tested the $4 threshold this month as the peak winter demand season nears,” the Wall Street Journal said in a report yesterday. “Several traders believe prices have to go higher because of home-heating demand, but they have been thwarted by a steady stream of record supply from the domestic oil and gas boom. Front-month natural-gas prices retreated within two days each of the other four times they hit the $4 mark since mid-July.”
Today November natural gas traded at $4.13, according to Bloomberg, while U.S. oil prices posted their largest decline since 2012, with West Texas Intermediate crude closing below $91.50 per barrel, off more than $3.00 per barrel.
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