Author Archives: Richard Meyer

Richard Meyer Natural Gas Market Indicators: August 15, 2014

With underground storage exceeding 2.5 Tcf by August 15 and nearly 80 days remaining in the traditional injection season, an inventory of 3.5 Tcf or more to enter the winter appears very likely. A strong summer long injection season has been supported by cooler than normal temperatures, minimal supply disruptions due to hurricane activity and continued growth in domestic production.

When the 2014-15 winter begins, the nearly 4 Bcf per day of incremental production growth dating back to the beginning of the year will still be with us and will be a part of supply assets in place to meet winter heating season demand. Efficiency measures will still be putting downward pressure on average consumption per customer and in the local gas utility segment, more distribution pipeline will have been modernized creating a safer system. So many moving parts – and so many moving in the right direction.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Richard Meyer Natural Gas Market Indicators: July 31, 2014

The end of July has brought with it softening natural gas prices, the result of a confluence of supply and demand elements. Only a few months ago, some analysts questioned whether natural gas storage levels would be able to make a comeback following an 11-year record low for inventories at the end of the winter season. Today, we see natural gas volumes injected into storage at rates not seen in more than a decade and prices in the sub $4 range. Modest temperatures, seasonally low power generation load requirements, and record natural gas production are all ingredients into this summer’s recipe for relatively low Henry Hub prices and the supply position in which the country now finds itself immersed. That said, there still remains two months of summer, three months in the underground storage injection season, and an Atlantic hurricane season that has just gotten underway. Factors to keep an eye on include an uptick in temperatures; natural gas requirements for power generation; dry gas production flows; and supply issues related to disruptive weather events, such as storms in the Gulf of Mexico. However, even if one or more of these possibilities materializes, the US is still in a strong supply position – a fact that the market may be taking into account.
Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas and Rig Counts.
Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.
Posted in energy, Natural Gas, Natural Gas Market Indicators, weather, winter heating | Leave a comment

Richard Meyer Natural Gas Market Indicators: July 15, 2014

As the northern hemisphere summer is half way through, perhaps it is a good time to take stock of where we are at.

On the supply front, production is as strong as it has ever been, with near record-breaking levels of dry gas produced at volumes more than 68 Bcf per day since June. Supplies directed toward storage have been similarly robust with a record setting eight straight weeks of 100+ Bcf injections since May. In other words, production is solid and supplies are rebuilding.

On the demand side, cooler summer temperatures compared with 2013 have eased power burn demand this July by nearly 2 Bcf. Industrial and residential-commercial demand are up slightly, as well as exports to Mexico. Therefore, the decline in July demand overall relative to last year is only 0.6 Bcf per day.

The result of this supply-demand balance is a natural gas price at Henry Hub of $4.11 per MMBtu – well below where the summer season began. This suggests that the market sees a sturdy supply portfolio that is able to meet both short-term demand pulls and seasonal storage obligations as operators refill for next winter. In other words, the market is behaving in an expected fashion.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Richard Meyer Natural Gas Market Indicators: June 27, 2014

The U.S. Energy Information Administration reminded us this month that the world’s first purpose-built, ocean-going LNG carrier, the Methane Princess, was placed into service 50 years ago in June 1964. That ship, and her sister vessel, the Methane Progress, traveled primarily between Algeria and the UK. Today, there are 357 such ships generally averaging five times the capacity of the original transporter.

Domestic production remains strong and growing, and storage injections’ aggressive poise has coincided with a slight softening of prices. Following one of the coldest winters in decades and the strongest demand pull ever, the physical market appears to be adjusting accordingly.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

Posted in energy, LNG, Natural Gas, weather, winter heating | Leave a comment