Henry Hub Every day Pure Gasoline Spot Worth Fell to File Lows in February

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The U.S. benchmark Henry Hub every day pure gasoline worth averaged $1.50 per million British thermal models (MMBtu) on February 20, 2024, the bottom worth in inflation-adjusted {dollars} since at the very least 1997, in accordance with knowledge from Refinitiv Eikon. Excessive pure gasoline manufacturing, low pure gasoline consumption, and better pure gasoline 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 gasoline manufacturing typically rose all through 2023, averaging a report excessive of 105.7 billion cubic toes per day (Bcf/d) in December 2023, in accordance with knowledge from S&P World Commodity Insights. Following a brief decline in manufacturing in mid-January resulting from winter storm Heather, manufacturing has remained comparatively excessive since January 26, averaging over 104.1 Bcf/d. Pure gasoline consumption within the U.S. residential and industrial sectors to date 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Due to excessive manufacturing and comparatively low consumption, much less pure gasoline has been withdrawn from storage this winter. For the week ending February 16, U.S. working pure gasoline inventories averaged 12% above the year-ago common and practically 22% above the five-year (2019–23) common, in accordance with our Weekly Pure Gasoline Storage Report. Comparatively excessive storage ranges point out an oversupplied market and contribute to decrease pure gasoline costs.

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

Principal contributors: Andrew Iraola, Katy Fleury, Max Ober

Courtesy of U.S. EIA.