EIA: Natural gas production, prices likely to remain relatively flat

The U.S. Energy Information Agency (EIA) expects U.S. dry natural gas production to grow between 1-2% in 2024-25, according to its latest Short-Term Energy Outlook.

The EIA sees production at about 1.5 billion cubic feet per day (Bcf/d) in 2024 and 1.3 Bcf/d in 2025, down from growth of 4.0 Bcf/d in 2023.

“We expect the spot price of natural gas to average $2.70 per million British thermal units (MMBtu) in 2024 and rise to an average of about $3.00/MMBtu in 2025, up from an average of $2.54/MMBtu in 2023,” according to the EIA’s report. “Prices increase because of slowing growth in natural gas production and increasing U.S. liquefied natural gas exports, particularly in 2025 following the addition of new export capacity in late 2024. However, we expect upward price pressures will be limited by relatively flat consumption of natural gas in the electric power sector and persistently high inventories.”

The EIA expects U.S. electricity generation to grow by 3% in 2024 and be unchanged in 2025. Electricity generation from natural gas will be unchanged in 2024 and 2025 compared with 2023, the EIA said.

“Our forecast of crude oil production in the United States reaches 13.2 million barrels per day (b/d) in 2024 and more than 13.4 million b/d in 2025, both of which would be new records,” the EIA states. ”Production growth continues over the next two years driven by increases in well efficiency. However, growth slows because of fewer active drilling rigs.”