Market Update: April 24, 2024

Natural gas futures have seen gains in the past several days due to the increase in LNG feedgas and lower production. Cooler temperatures expected in the Upper Midwest and Northeast this week could drive up heating demand. However, the market remains tempered by an inventory surplus.

The latest storage report from the EIA stated an increase of 50 BCF. The current inventory level now sits at 2.333 TCF, which is 22.2% higher than last year and 36.4% higher than the 5-year average.

According to Baker Hughes, the latest rig count increased by two to 619 total rigs. Oil rigs increased by five while gas rigs fell by three. One year ago, the total rig count stood at 753 rigs.

This week’s additional graphic shows EIA’s forecasts from the Short-Term Energy Outlook (STEO) regarding U.S. LNG exports and natural gas trade. It highlights expected growth in LNG exports driven by three upcoming projects, which are expected to reach full capacity by 2025. The EIA also projects increased natural gas exports via pipelines, mainly to Mexico. According to the STEO, U.S. natural gas net exports are predicted to rise by 6% to 13.6 Bcf/d in 2024 and by a further 20% to 16.4 Bcf/d in 2025.