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US LNG demand remains high in the world

Global demand for US LNG has remained high, limiting some downward pressure on natural gas prices, the US Energy Information Administration (EIA) reported.

In November, the natural gas spot price at Henry Hub averaged $ 5.05 per million British thermal units (MMBtu), below the October average of 5.51/MMBtu but above an average of 3.25 / MMBtu in the first half of 2021.

After rising in recent months, natural gas prices fell in November amid mild weather across much of the country that resulted in less than expected natural gas used for space heating, according to the EIA. ..

Declining demand for natural gas also contributed to inventory levels approaching the five-year average (2016-2020).

LNG demand

In the United States, natural gas prices increased approximately 50% during the 2021 quarter, to more than $ 5.00 per MMBtu, a price level not seen outside of winter since 2009.

According to investment firm Brookfield Public Securities Group, resilient global demand for natural gas and a lack of sufficient available supplies have created a short-term energy crunch, considering figures at the end of the third quarter of the current year.

Resilient global demand for natural gas and

Until the end of last September, gas inventory levels in regions like the United States and Europe were below five-year norms, potentially posing a threat to energy reliability and relatively cheap access to heating fuels.

The precarious global storage situation pushed the Asian LNG reference price to more than $ 30 per MMBtu, a level never seen before.

The third quarter of 2021 was the negative first quarter for the midstream sector since the same period last year.

In particular, the most notable story in the energy sector during the third quarter of 2021 was the sharp increase in natural gas prices.

The tight natural gas supply and demand environment at the end of the quarter was not an anomaly in the energy markets: Natural gas liquids (NGL) prices increased more than 25% during the third quarter due to similarly tight market fundamentals.

Prices for heating supplies like propane, for example, increased 33% during the quarter.

 

Redacción Opportimes

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