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The U.S. benchmark Henry Hub every day pure fuel value averaged $1.50 per million British thermal items (MMBtu) on February 20, 2024, the bottom value in inflation-adjusted {dollars} since not less than 1997, based on knowledge from Refinitiv Eikon. Excessive pure fuel manufacturing, low pure fuel consumption, and better pure fuel inventories than the earlier five-year (2018–22) common contributed to costs declining for a lot of 2023 and the primary two months of 2024.

U.S. dry pure fuel manufacturing typically rose all through 2023, averaging a document excessive of 105.7 billion cubic ft per day (Bcf/d) in December 2023, based on knowledge from S&P World Commodity Insights. Following a short lived decline in manufacturing in mid-January because of winter storm Heather, manufacturing has remained comparatively excessive since January 26, averaging over 104.1 Bcf/d. Pure fuel consumption within the U.S. residential and industrial sectors thus far this winter heating season (November 1, 2023–March 31, 2024) averaged about 5% (2.0 Bcf/d) decrease than the five-year (2019–23) common, at 35.8 Bcf/d.

Due to excessive manufacturing and comparatively low consumption, much less pure fuel has been withdrawn from storage this winter. For the week ending February 16, U.S. working pure fuel inventories averaged 12% above the year-ago common and almost 22% above the five-year (2019–23) common, based on our Weekly Pure Fuel Storage Report. Comparatively excessive storage ranges point out an oversupplied market and contribute to decrease pure fuel costs.

Since February 7, the Henry Hub every day pure fuel value has been beneath $2.00/MMBtu, reaching its lowest value on February 20; six of the record-low every day costs when adjusting for inflation occurred this month. The final time the Henry Hub value was this low was in 2020, when it averaged $2.05/MMBtu for the yr. In 2020, low costs had been largely because of the financial results of the COVID-19 pandemic, together with low pure fuel consumption, and the delicate 2019–20 winter, which ended with comparatively excessive pure fuel storage inventories.

Principal contributors: Andrew Iraola, Katy Fleury, Max Ober

Courtesy of U.S. EIA.