09 September 2009 19:33 [Source: ICIS news]
The department’s Energy Information Administration (EIA) said in its monthly short-term energy outlook (STEO) that spot prices for natural gas at the Henry Hub terminal will average $3.65/MM Btu this year, revised downward from last month’s EIA estimate of an average 2009 price at $3.92/MM Btu.
In 2010, the administration expects that the average Henry Hub spot price for natgas will be $4.78/MM Btu. That forecast is nearly 13% below the 2010 average gas price estimate of $5.48/MM Btu issued by the administration a month ago.
Natural gas is a major feedstock and energy fuel for US petrochemical producers and downstream chemical and resin manufacturers.
In revising average gas prices downward for this year, the administration noted that US natgas inventories likely will set a new record high by the end of the injection period, 31 October, reaching 3,800bn cubic feet (bcf).
The administration projects that
“EIA expects this year-over-year consumption decline will continue through the second half of the year for industrial users, although the trend will be less pronounced,” the administration said.
The abundance of gas in storage and continuing low demand due to the recession will combine to produce an average natgas price of only $2.32/MM Btu in October, the agency predicted. That would be the lowest monthly average spot price since September 2001.
In oil, the administration maintained its month-earlier forecast of an average of $70/bbl for benchmark West Texas Intermediate (WTI) crude for the fourth quarter this year, a $27/bbl increase over the first quarter.
However, the EIA expects that improving global economic conditions will edge world oil prices upward in the new year, reflected in the administration’s forecast for an average 2010 price for WTI of $75/bbl.
That estimate is up from last month’s forecast of a $72/bbl average WTI price for 2010.
($1 = €0.69)
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