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Weather the Most Significant Factor for US Natgas Market: EIA

NATGAS

The weather conditions will remain the most significant factor affecting US natural gas prices according to an EIA supplement to the recent Short-Term Energy Outlook.

  • Additional effects on prices by 2024 could come from prevailing storage inventories at the end of the summer, emerging trends in macroeconomic growth, timing of renewable capacity additions and drilling investment and productivity.
  • Regional variations across the country will come from natural gas production, transportation, storage, consumption, and trading.
  • The main factors impacting the market this winter and into the summer include seasonal temperature variation, extreme weather events and equipment outages.
  • A cold winter 23-24 is likely to be the biggest focus into 2024 but other drivers are macroeconomic factors, the strength of the LNG market, changing electricity generation sources and drilling productivity and transportation capacity.
  • Macroeconomic growth, new climate and energy policies, changes in the electricity resource mix and capital investment trends could strongly affect domestic consumption beyond 2024.

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