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Winter 2018 vs Winter 2019:

Could U.S. natural gas go from a 5-year deficit to an outrageous 5-year surplus in 12 months?

The lower 48 natural gas storage deficit to the five year average has grown throughout the summer of 2018 despite the largest period of production growth witnessed in history. The market now faces the prospect of an end of season storage balance of 3.4 TCF, 0.4 TCF lower than the five year average and the lowest level for the end of the typical injection season since 2008. This year, despite the large storage deficit, natural gas prices have refused to climb with any significance. Several factors could account for the break in this long lasting relationship, or the market could be significantly undervaluing the risk associated with entering the winter with a low storage balance.

By the end of summer 2019, strong production gains in the Northeast and from associated gas are expected to push storage inventories to the upper end of historical bounds. Within these parameters are extremes of supply and demand from several sectors including production, LNG and Mexican exports and gas fired power generation demand. Join OPIS PointLogic as we discuss these market factors and their ramifications.

You'll walk away with:

  • An understanding of the drivers behind the growth in production we’ve seen this year and how this changes in 2019.
  • An understanding of the systemic shift in domestic demand related to gas-fired power demand and non-systemic forecasts of winter residential and commercial demand.
  • OPIS PointLogic’s expectation for LNG export capacity additions and exports.
  • How Henry Hub prices are expected to react in this whipsaw market and what that means for gas fired power generation.
  • How different scenarios could play out this winter and their impact on the level of storage inventories expected in April 2019.

Meet your speakers:

Jack-Weixel-webJack Weixel
Vice President, Demand
OPIS PointLogic

 

 

Charles-NevleCharles Nevle
Vice President, Supply
OPIS PointLogic