Richard Meyer 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.

Perhaps the key to this puzzle is not rig counts but demand for natural gas. Realizing the full potential of North American natural gas energy may not occur until it is actually demanded.

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

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