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A series of slides from the NGSA that shows, in essence, they believe the short-term summer price for natural gas in the U.S. to rise over last summer because of depleted stores of natural gas. It will take extra capacity to bump up the "gas in storage" and because of the increased demand, the NGSA says the price will tick up.
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Summer Outlook Cooling Season
2014
1
Looking Ahead to Summer 2014 Market pressure points: demand, economy, weather,
storage & production Wild card factors Summer expectations
Summary
2014 Summer Outlook: Outline
2
Understanding the Symbols
3
Upward market pressure
Flat market pressure
Downward market pressure
Market Pressure Points 2014
4
Last Summer 2013 ACTUAL
This Summer 2014 FORECAST
Actual season: 6% cooler than 2012 5% warmer than 30-year average
1,293 Cooling degree days
1% warmer than last year 6% warmer than 30-year average
Summer-to-summer pressure on natural gas prices
5
Source: NOAA forecast map, May 2014 1,306 Cooling degree days
Weather Demand: Summer Season Data source: NOAA, EVA
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Summer Season Last Summer Period-to-period change 2013 Data source: IHS Global Insight ACTUAL
Summer 2014
FORECAST
Economy Fell short of expectations Expanding
GDP growth 1.8% 2.4% Unemployment rate 7.4% 6.5% Manufacturing 2.4% 3.6% CPI 1.5% 2.0% Consumer Sentiment Index 81.6 86.5
Summer-to-summer pressure on natural gas prices
Pressure Point: Economy/Demand
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Summer Season Last Summer Period-to-period change 2013 Data source: U.S. Energy Information Administration; EVA ACTUAL
Summer 2014 FORECAST
Total Demand Industrial demand Electric demand Residential/commercial
60.2 Bcf/d 19.4 Bcf/d 23.8 Bcf/d 11.4 Bcf/d
60.4 Bcf/d 20.3 Bcf/d 23.1 Bcf/d 11.4 Bcf/d
Change from previous year +0.3%
Growth sector Residential/ Commercial Industrial
Summer-to-summer pressure on natural gas prices
Overall Gas Demand/Consumption
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Note: 2010, 2011 and 2012 denote very hot summers. Coal-to-gas switching in 2014 is forecasted. Source: EVA, May 2014
Portion of Electric Demand Attributable to Coal-to-Gas Switching Follows Price
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Source: Energy Ventures Analysis, Outlook for Natural Gas Demand for the Summer of 2014, Exhibit 14 “New U.S. Generation Capacity”
Steady Growth in New Natural Gas-fired Generation Capacity 2010-2015
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Total = 4.7 BCF/DAY
Majority of Industrial Growth Occurs in Fertilizer, Gas-to-Liquids Sectors Growth by industrial application 2010-2019
Source: Energy Ventures Analysis, 2014
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Storage/Demand Summer Season Period-to-period change Data source: EIA, EVA
Last Summer 2013
ACTUAL
Summer 2014
FORECAST
Season starting point (billion cubic feet)
1,687 Bcf
826 Bcf
Average weekly injections 68 Bcf 83 Bcf projected
End-of injection season 3,816 Bcf 3,400 Bcf projected
Summer-to-summer pressure on natural gas prices
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Note: 2014 is estimated. Source: EIA and EVA, 2014
Storage Injections 2003-2014 Record-breaking Storage Injections Projected
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Source: EIA and EVA, 2014
Total = 4.4 Tcf
Two-thirds of Storage Near Consumers Producing Region Characterized by Flexible Salt Dome Storage
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Summer Season Period-to-period change Data source: EIA, EVA
Last Summer 2013
ACTUAL
Summer 2014
FORECAST
Summer average production 66.6 Bcf/d 68.5 Bcf/d
Canadian imports (net) 5.0 Bcf/d 5.0 Bcf/d
LNG imports 0.3 Bcf/d 0.3 Bcf/d
Mexican exports -1.8 Bcf/d -1.9 Bcf/d
Summer-to-summer pressure on natural gas prices
Production/Supply
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Summer Outlook: Wild Cards Hot summer could increase electric demand
End to California drought /mild summer could decrease electric demand Very active hurricane/storm season
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Summer Season Period-to-period change
This Summer 2014 FORECAST
Weather
Economy
Overall demand
Storage
Overall supply
Summer 2013-to-summer 2014 Pressure on natural gas prices
This Season’s Summer Outlook
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Summary Increase in natural gas supplies supporting continued
industrial and electric growth Natural gas serving demand and storage needs at
record pace Fuel switching persists for sixth straight summer -- but
retreats to 2010 levels
