Energy Information Administration Logo. If you need assistance viewing this page, please call (202) 586-8800

Natural Gas Summary from the Short-Term Energy Outlook
EIA Home > Natural Gas > Natural Gas Weekly Update
Natural Gas Summary from the Short-Term Energy Outlook

   

 

 

Natural Gas Summary from the Short-Term Energy Outlook:

 

The Energy Information Administration (EIA) projects that natural gas wellhead prices will average $4.17 per MMBtu during the last 3 months of 2003 and increase to $4.32 in January 2004 (Short-Term Energy Outlook, October 2003). Prices have fallen somewhat from the unusually high levels that prevailed in the first half of the year and most of July, as mild summer weather and reduced industrial demand allowed record storage refill rates. As of October 3, 2003, working gas levels were only 1 percent below the 5-year average and, barring any disruptions, are on target to reach 3 Tcf by the end of October. With the improved storage situation, wellhead prices during the upcoming heating season (November through March), assuming normal weather, are expected to be about 13 percent less than last winter ($4.17 vs. $4.68 per MMBtu). But prices in the residential sector are projected to be about 9 percent higher than last winter, as the recent decline in wellhead prices is too recent and insufficient to offset the impact of the substantial spring-summer increase in wellhead prices on residential prices. Overall in 2003, wellhead prices are expected to average $4.75 per MMBtu, which is nearly $2 more than the 2002 annual average and the largest year-to-year increase on record. For 2004, wellhead prices are projected to drop by nearly $0.90 per MMBtu, or about 20 percent, to $3.86 per MMBtu as the overall supply situation improves.

Natural gas production is expected to increase by about 2.1 percent in 2003. Following the downturn in natural gas-directed drilling activity in 2002, higher natural gas prices and sharply higher oil and natural gas field revenues continue to drive the resurgence in drilling this year. The number of rigs drilling for natural gas has totaled more than 900 since the week ending June 13 and averaged 932 in August and 936 in September. In 2004, production is expected to remain at modestly improved levels. The prospects for significant reductions in natural gas wellhead prices in 2004 depend on the productivity of the expected upsurge in drilling.

Natural gas demand is expected to fall by about 1.1 percent in 2003 because of reduced demand in the industrial sector and electric power sectors as a result of high prices and the sharply lower weather-related demand following the first quarter of 2003. This winter, assuming normal weather, natural gas demand is expected to be about 2.4 percent less than last winter’s level as gas-weighted heating degree-days for the season (Q4 2003 and Q1 2004) are projected to be about 3.7 percent less than year-ago levels. Overall in 2004, natural gas demand is expected to increase because of accelerated economic growth and generally lower prices.


 

Short-Term Natural Gas Market Outlook, October 2003 

 

History

Projections

 

Jul-03

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

PRICES ($/MMBtu)

 

 

 

 

 

 

  Average Wellhead Price

4.78

4.60

4.27

4.12

4.15

4.23

  Residential Price

12.27

12.23

11.62

10.22

9.27

8.81

  Electric Utilities Price

4.88

4.94

4.57

4.65

4.82

5.02

 

 

 

 

 

 

 

SUPPLY (Trillion Cubic Feet)

 

 

 

 

 

 

  Total Dry Gas Production

1.645

1.646

1.588

1.641

1.592

1.623

  Net Imports

0.306

0.328

0.325

0.332

0.305

0.338

    Imports

0.362

0.384

0.380

0.389

0.363

0.397

    Exports

0.056

0.056

0.055

0.057

0.058

0.059

  Suppl. Gaseous Fuels

0.006

0.006

0.006

0.006

0.007

0.008

  Total New Supply

1.957

1.980

1.919

1.980

1.904

1.969

 

 

 

 

 

 

 

  Working Gas in Storage

 

 

 

 

 

 

    Opening

1.710

2.095

2.410

2.837

3.086

2.965

    Closing

2.095

2.410

2.837

3.086

2.965

2.487

  Net Storage Withdrawal

-0.386

-0.315

-0.427

-0.249

0.121

0.477

 

 

 

 

 

 

 

  Total Supply

1.571

1.665

1.493

1.731

2.026

2.446

 

 

 

 

 

 

 

  Balancing Item

0.041

-0.016

0.036

-0.165

-0.210

-0.172

 

 

 

 

 

 

 

  Total Primary Supply

1.612

1.649

1.529

1.565

1.816

2.274

 

 

 

 

 

 

 

DEMAND (Trillion Cubic Feet)

 

 

 

 

 

 

  Lease & Plant Fuel

0.088

0.086

0.078

0.075

0.079

0.080

  Pipeline Use

0.051

0.053

0.049

0.052

0.056

0.067

  Delivered to Consumers

1.473

1.509

1.402

1.438

1.681

2.127

    Residential

0.121

0.112

0.128

0.212

0.436

0.730

    Commercial

0.130

0.127

0.128

0.179

0.277

0.400

    Industrial

0.564

0.584

0.566

0.612

0.612

0.647

    Electric Power

0.658

0.686

0.579

0.435

0.356

0.350

  Total Demand

1.612

1.649

1.529

1.565

1.816

2.274

 

Source:  Energy Information Administration, Short-Term Energy Outlook, October 2003.

 

Need Help?
phone: 202-586-8800
email: infoctr@eia.doe.gov
Specialized Services from NEIC

For Technical Problems
phone: 202-586-8959
email:wmaster@eia.doe.gov

     Energy Information Administration, EI 30
1000 Independence Avenue, SW
Washington, DC 20585

 

 

Home | Petroleum | Gasoline | Diesel | Propane | Natural Gas | Electricity | Coal | Nuclear

Renewables | Alternative Fuels | Prices | States | International | Country Analysis Briefs

Environment | Analyses | Forecasts | Processes | Sectors