10 October 2012 19:03 [Source: ICIS news]
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In its monthly short-term energy outlook (STEO), the Energy Information Administration (EIA) said it expects the spot price for
The EIA is the data collection and analysis arm of the Department of Energy (DOE).
If US natgas prices were to climb back to the $3.35 range next year, they would be within 65 cents of the 2011 average of $4.00/MMBtu.
Natural gas industry officials have forecast that
The availability and price of natural gas is of critical importance for the
The EIA said that while electric utilities saw large gains in the use of natural gas as a power generator this year, the pace of that increase is expected to ease in 2013 as natgas prices increase.
“Projected higher natural gas prices contribute to a 10.4% decline in forecast natural gas consumption in the electric power sector in 2013,” the STEO report said.
Nevertheless, “natural gas consumption in the power sector next year is still expected to be about 1.9bn cubic feet per day (bcf/d) higher than 2011 levels and high by historical standards”, the analysis said.
Electric utilities have accelerated their longstanding switch to natgas from coal-fired power generation, especially as new federal environmental regulations are raising costs for coal-dependent utilities and forcing the shutdown of some generators.
Although utilities’ use of natgas is expected to decline somewhat next year, that downturn in consumption will be more than offset by increased use of the fuel in the residential, commercial and industrial sectors, the report said.
A more normal North American winter season will drive increased natgas consumption in residential and commercial sectors, the EIA said.
While the 2012-2013 winter season is expected to bring normal cold temperatures, the period will be much colder than last winter’s abnormally warm weather, the report said.
Gains in industrial consumption forecast for next year are attributed to an improving
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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