NGSA Expects Pressure on Natural Gas Prices To Increase This Sum - Clarksburg, Morgantown: News, Sports, Weather

NGSA Expects Pressure on Natural Gas Prices To Increase This Summer Compared to 2013

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Pressure on natural gas prices is expected to be upward this summer as compared to last summer, according to the Natural Gas Supply Association's 2014 Summer Outlook assessment of the natural gas market released yesterday.

The study evaluated the impact of weather, economy, customer demand, production activity and storage inventories on the direction of natural gas prices. NGSA noted that the upward pressure on prices is over summer and doesn't include winter price data.

Weather, economy and demand are expected to exert neutral pressure on prices and production is even expected to exert downward pressure. However, storage factors alone are expected to override these and cause the overall upward pressure on prices.

“When NGSA weighed all the different factors, the picture that emerged for this summer is one of slightly increased pressure on natural gas prices, chiefly because of the need to inject a greater than average amount of natural gas into storage in the wake of an extreme winter,” said Greg Vesey, chairman of NGSA and vice president of Gas Supply and Trading for Chevron. “Looking at all key factors combined, NGSA expects soft upward pressure on prices compared with last summer."

Record weekly storage injections averaging around 83 Bcf per week are expected to bring storage to 3,400 Bcf by the end of the injection season.

“We have confidence in the market’s resilience and ability to achieve those record weekly injections, thanks to the industry’s responsiveness and the abundance of shale gas," Vesey said. "It’s a testament to the flexibility of our industry that we were able to average storage injections of 79 Bcf/week even back in 2003, long before shale gas had increased production to our current record-setting levels.”