US gas spot price jumps above expected average
US natural gas prices on June 23 were up more than 1% early in the session, blowing past federal expectations on higher demand and exports.
The spot price for Henry Hub, the US benchmark traded on the New York Mercantile Exchange, was up 1.14% as of 7:45 a.m. ET to trade at $3.30/mn Btu. That marks a slight decline from previous highs near $3.60 on the week, but is well above than the $2.31/mn Btu recorded this time in 2019, ignoring pandemic levels.
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The US Energy Information Administration (EIA) forecast a spot price for natural gas at $3.07/mn Btu for the year, a forecast that is $1.04/mn Btu higher than the record lows for last year.
EIA in its monthly report for June said it expected natural gas prices to remain elevated due to the increase in exports and consumption.
The sector started the year on its back foot after inclement weather in February idled both upstream and downstream activity in the US south, home to some of the richest shale basins in the country.
Spot natural gas prices eclipsed $5/mn Btu in February, leading to the elevated estimate for the year.
The spot price for Henry Hub is expected to average $2.93/mn Btu next year as domestic natural gas supply exceeds demand.