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The U.S. Henry Hub natural gas prices reached the lowest levels in 21 years last week, as supply rises slightly while demand drops, according to the U.S. Energy Information Agency (EIA).
The benchmark natural gas price reached $1.38 per million British thermal units (MmBtu) on Tuesday, June 16. This is the lowest since December 1998, the EIA said in its latest weekly report, Kallanish Energy notes.
The report, covering June 10 to June 17, stated that U.S. natgas prices fell 22 cents from $1.70/MmBtu to $1.48/MmBtu at the end of the week. Prices fell in most trading hubs, due to weak domestic and exports demand.
At the Chicago Citygate, gas prices dropped 10 cents from a high of $1.61/MmBtu on June 10 to $1.51/MmBtu last Wednesday. In Southern California, at the SoCal Citygate hub, prices declined 51 cents to end the reporting week at $1.72/MmBtu. In Northern California the drop was milder, at 27 cents, to $2.28/MmBtu.
In the northeast, the Tennessee Zone 4 Marcellus spot price decreased 14 cents to $1.30/MmBtu on Wed. June 17. The price at Dominion South in southwest Pennsylvania fell 16 cents to $1.31/MmBtu, the EIA said.
Total gas demand in the U.S. was 7.1% down week-on-week, but consumption in the power sector dipped 15.6% in the period as mild temperatures limited demand for electric power. Gas exports to Mexico declined 4.7%, while demand for LNG production was also lower.
Meanwhile, supply was slightly higher as some fields in the Gulf of Mexico resumed operations after the tropical storm, and dry gas production recorded a 0.5% increase. LNG exports were also higher w-o-w, with the U.S. shipping eight vessels carrying roughly 29 billion cubic feet (Bcf) of LNG.
