Natural Gas Market Indicators
This shouldn’t take too long. Natural gas acquisition prices are low. Storage inventories are bursting at the seams for this time of year and “must turn” requirements for some volumes of storage may put additional downward pressure on prices.
Warm weather for the country as a whole has completely trumped any market pressure on pricing that may have developed this winter given reductions in gas-directed drilling.
Natural Gas is the Fuel of the Future
The news this week has been full of stories about the low price of natural gas. Indeed, U.S. natural gas futures fell to $2.402 per million Btu, the lowest price since March 4, 2002. Our nation possesses a 100-year supply of this clean burning energy source and we are the largest producer of natural gas in the world. So what can we do with this abundant natural resource?
Natural gas is our country’s foundation fuel and is well positioned to serve as a reliable, secure and clean energy source for U.S. homes, businesses and industries for decades to come. In an article in the recent issue of Oil & Gas Monitor AGA President and CEO Dave McCurdy outlines some of the ways Americans can utilize natural gas to improve our economy, reduce our impact on the environment and secure our nation’s energy future. Take a look.
The promise of the gas revolution
In the January/February 2012 issue of EnergyBiz Magazine, American Gas Association President and CEO Dave McCurdy outlines why natural gas is America’s domestic, clean foundation fuel for now and for our long-term future.
Energy Biz did a terrific job of laying out for their readers the various options that neighborhoods, businesses and consumers have when choosing how to consume electricity, heat their homes, and cook their food. Dave McCurdy’s article is alongside others by leaders in the energy industry.
Natural Gas Market Indicators
While many analysts do not expect to see 2012 year-over-year production growth on the scale seen in 2011, most do not expect a precipitous decline in domestic production either. Slowing gas-directed rig counts are one possible indicator of the future flattening of U.S. gas production growth, however, many analysts point to rig, well and completion efficiency improvements along with an inventory of wells yet to be hooked up as a countering market force.
Indeed, pricing pressure today as a result of market forces means starting at a baseline of $3 per MMBtu. A 50 percent increase in average acquisition prices would only result in a baseline that many analysts believe is ultimately necessary to sustain the long-term health of U.S. gas production.
