Celsius Energy Forecast for U.S. natural gas - Sept 6

[dan_s]

At the time of this post, Celsius Energy was forecasting that the next four builds in U.S. natural gas storage will total 214 Bcf.

That compares to the 5-year average build of 356 Bcf for the four week period. The 142 Bcf difference will reduce the surplus to the 5-year average from 323 Bcf on August 30th to 181 Bcf by September 27th. My forecast is that natural gas in storage will be less than 3,800 Bcf mid-November when the first draws from storage will begin. If the gassers are lucky enough to see a significant cold wave move across the Northeast U.S. the week of Thanksgiving, it could get interesting real fast.

As I have posted here many times: "Market Forces will balance the U.S. natural gas market." They always do heading up to the beginning of the winter heating season which starts mid-November.

If Venture Global's big LNG export facility at Plaquemines, Louisiana does come on line by the end of September, my guess is that natural gas in U.S. storage will go below the 5-year average early in December.

If all goes according to my forecast, which agrees with Celsius Energy's forecast, it will be a MAJOR PARADIGM SHIFT. Investors will go from believing that the U.S. has a "glut" of natural gas to the potential for a shortage during the winter.

Unless we have a colder than normal winter, we should make it through the winter. However, Celsius Energy's forecast is that with a normal winter, U.S. natural gas storage will be in a deficit of over 500 Bcf by April 1, 2025 and the deficit will continue to grow because our major oil & gas basins lack the gas pipeline takeaway capacity to keep supply growing as fast as demand is growing.

Read our recent profile on Solaris Oilfield Infrastructure (SOI). Distributed Power Generation (using produced natural gas to generate electricity) could have a positive impact on Permian Basin gas prices.