Natural Gas Summary from the Short-Term
Energy Outlook |
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Natural
Gas Summary from the Short-Term Energy Outlook: EIA projects that natural gas prices will continue at
high levels through the rest of 2004 (Short-Term Energy
Outlook, June 2004). Wellhead prices
are expected to average $5.74 per MMBtu in the
summer months (June–August) and $6.00 per MMBtu in
the fourth quarter, while composite spot prices will likely stay well above $6.00 through
December. Spot prices averaged about $5.35 per MMBtu
in the first quarter of the year but have been above $6.00 since the
beginning of May, as strong demand for natural gas coupled with high
petroleum prices has led to higher gas prices despite nearly normal storage
inventory levels. Storage stocks at the end of May were less than 1 percent
below the 5-year average and 23 percent higher than last year at this time.
Overall in 2004, spot prices will likely average about $6.05 per MMBtu, which is 13 percent higher than the 2003 average. In 2005, prices are expected to decrease only slightly as
production gains are expected to be relatively low. Natural gas production is estimated to have increased by
approximately 0.6 percent in 2003.
Growth of about 0.9 percent in 2004 is expected as new natural gas
well completions, which totaled an estimated 20,000 in 2003, remain high at
more than 24,000 wells per year for the next 2 years. Because of apparently
high decline rates from existing wells, these high drilling rates are not
expected to yield more than modest net gains in
Source: Energy
Information Administration, Short-Term Energy Outlook, June 2004. Need Help? |
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Energy Information Administration, EI 30 |
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