MNI BRIEF: Canada PM Carney Derides Trump's 51st State Idea

MNI BRIEF: Carney Sworn In As PM, Names Champagne To Finance

MNI China Daily Summary: Friday, March 14

MNI BRIEF: China February M2 Stays At 7% Y/Y

RPT-MNI INTERVIEW2: Lag Justifies Faster CNB Easing - Holub

BAKER HUGHES CANADA RIG COUNT 199; OIL RIGS 139; GAS RIGS 60

MNI: BAKER HUGHES US RIG COUNT 592; OIL RIGS 487; GAS RIGS 100

EZ/UK T-Bill Calendar: DE, NL and FR Due Monday

GERMANY: Union/SPD Migration Alignment After Turmoil Threatened Debt Deal (BILD)

GERMANY: Official Interim Election Results Tilt Towards Missing BSW & FDP

© 1982-2025 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

AMERICAS OIL: U.S. gas production poised for rebound as oil growth stalls: Kemp

AMERICAS OIL
USEnergy BulletsNorth AmericaBulletCommodities

U.S. gas production poised for rebound as oil growth stalls: Kemp

  • Analyst John Kemp writes, “sharply diverging outlooks for U.S. oil and gas production explain why hedge fund positions at the end of February were exceptionally bullish for gas but near a record low for oil.”
  • Total crude and condensates production from the Lower 48 states excluding federal waters in the Gulf of Mexico averaged 11.2 mb/d in December 2024.
  • Lower 48 output was only marginally below the record high the previous month but had increased by less than 0.2 mb/d compared with the same month a year earlier.
  • Growth has steadily decelerated from around 1 mb/d towards the end of 2023 as the shock caused by Russia’s invasion of Ukraine in February 2022 has faded.
  • Oil drilling and production generally react to price changes with a delay of about 5 months and 12 months, respectively.
  • Unlike oil, U.S. gas production is likely to increase significantly in 2025, after prices more than doubled in real terms from the multi-decade low in Q1 2024.
  • Dry gas production declined slightly to an average of 103.2 bcf/d in 2024 from 103.6 bcf/d in 2023.
  • Falling production, combined with record consumption from gas-fired generators, growth in exports, and the coldest winter for six years, has tightened supplies sharply.
  • Surplus inventories in March 2024 inherited from the very mild winter of 2023/24 had been transformed into a large and widening deficit by February 2025.
  • So far, there has been no measurable increase in drilling, but production has been climbing steadily, likely as producers complete already-drilled holes and increase flow rates from wells in production.
  • Dry production increased to an average of 105.7 bcf/d in December 2024, the highest for 10 months, up from a low of 101.8 bcf/d in September 2024.
  • Production will have to increase significantly in 2025 to stem the unsustainable inventory depletion – the only question is how high prices have to rise to induce the necessary response and choke off some gas use by generators. 
322 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

U.S. gas production poised for rebound as oil growth stalls: Kemp

  • Analyst John Kemp writes, “sharply diverging outlooks for U.S. oil and gas production explain why hedge fund positions at the end of February were exceptionally bullish for gas but near a record low for oil.”
  • Total crude and condensates production from the Lower 48 states excluding federal waters in the Gulf of Mexico averaged 11.2 mb/d in December 2024.
  • Lower 48 output was only marginally below the record high the previous month but had increased by less than 0.2 mb/d compared with the same month a year earlier.
  • Growth has steadily decelerated from around 1 mb/d towards the end of 2023 as the shock caused by Russia’s invasion of Ukraine in February 2022 has faded.
  • Oil drilling and production generally react to price changes with a delay of about 5 months and 12 months, respectively.
  • Unlike oil, U.S. gas production is likely to increase significantly in 2025, after prices more than doubled in real terms from the multi-decade low in Q1 2024.
  • Dry gas production declined slightly to an average of 103.2 bcf/d in 2024 from 103.6 bcf/d in 2023.
  • Falling production, combined with record consumption from gas-fired generators, growth in exports, and the coldest winter for six years, has tightened supplies sharply.
  • Surplus inventories in March 2024 inherited from the very mild winter of 2023/24 had been transformed into a large and widening deficit by February 2025.
  • So far, there has been no measurable increase in drilling, but production has been climbing steadily, likely as producers complete already-drilled holes and increase flow rates from wells in production.
  • Dry production increased to an average of 105.7 bcf/d in December 2024, the highest for 10 months, up from a low of 101.8 bcf/d in September 2024.
  • Production will have to increase significantly in 2025 to stem the unsustainable inventory depletion – the only question is how high prices have to rise to induce the necessary response and choke off some gas use by generators.