Arlington, Virginia – September 26, 2016 – EVA has released its monthly forecast of the U.S. natural gas markets with related prices for the month of September. With the Summer now firmly in the past the current focus is on the near term uncertainties that will dominate the outcome of Winter 2016/2017 supply and prices. While expectations are for milder-than-normal temperatures this winter, the outcome could be considerably colder with a correspondingly higher demand for gas. The other uncertainty is the timing and impact of the infrastructure event that would unlock additional production into the market.
Looking past the current season, the structural demand for natural gas is rising. Both LNG exports and pipeline exports to Mexico are forecast to increase substantially. In addition, EVA’s tracking of industrial and electric power capacity additions is expected to boost the installed base of natural gas-consuming facilities—well beyond the declines expected at existing industrial facilities. Further gains in natural gas demand are expected due to the ongoing retirements of coal-fired power plants. Indeed, EVA is forecasting that the nature of coal-to-gas switching—a hall mark of the recent natural gas market—will be significantly altered by these retirements.
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