Natural Gas Market Remains Volatile: Too Much Supply Still Chasing Too Little Demand

SUGAR LAND--April 6, 2017--Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--For U.S. natural gas producers, this could be as good as it gets for the next few years. A weak winter heating season has caused one consulting firm, Drillinginfo Incorporated (Austin, Texas), to sharply reduce its average gas price forecast for 2017.

In November 2016, the firm forecasted gas prices at Henry Hub would average $4.25 per million British thermal units (MMBtu) for 2017. That forecast assumed normal winter weather. But the just-concluded winter heating season was significantly warmer than normal, causing Drillinginfo to lower its 2017 price forecast to $3.50 per MMBtu, an 18% decline.