Yahoo Finance EIA Reports Increase in Natural Gas Production, Week to April 24
Natural Gas Inventories Support Prices in Week Ending April 24 (Part 3 of 4)
Production trends for week ending April 24
The EIA (U.S. Energy Information Administration) reported on natural gas supply for the week ended April 24. Total natural gas supply increased 0.8% compared to the week ended April 17, according to data from Bentek Energy. It was ~9.3% greater than the corresponding week last year.
Total marketed production for the month of February, the latest month for which the EIA has provided data, was 78.6 billion cubic feet per day (or bcf/d). Marketed natural gas is the gas produced before associated liquids like propane and butane are extracted. The removal of these liquids leaves dry natural gas.
Forecast production trends for 2015
The EIA continues to be bullish about natural gas production in 2015. Its April Short-Term Energy Outlook (or STEO) released on April 7 projects that total marketed natural gas production will grow 5% to 78.47 bcf in 2015. It projected further growth of 1.9% to 79.96 bcf in 2016. It estimates that total marketed natural gas production was 74.72 bcf in 2014.
The next STEO will come out on May 12.
Continued production growth has set a grim scenario for natural gas prices. High production levels are bearish for natural gas prices. Weak prices hurt gas-producing companies like Chesapeake Energy (CHK), Southwest Energy (SWN), Range Resources (RRC), and Antero Resources (AR). These companies are components of the iShares Global Energy ETF (IXC) and make up 1% of the ETF.
Natural gas inventories are governed by natural gas production and consumption trends. In the next part of this series, we’ll look at natural gas consumption trends.
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