With record growth in natural gas production in the forecast, federal energy officials see prices for the fuel moderating in the coming months. And that's good news, considering they also expect more electricity to be coming from natural gas this year and next.
In its Short-Term Energy Outlook (pdf) issued Feb. 6, the Energy Information Administration sees this month's spot price at Louisiana's Henry Hub averaging $3.34 per million British thermal units. But for the entire year the forecast average falls to $3.20, and in 2019, EIA forecasts a $3.08 average.
You can credit that to what's expected to be record production.
EIA estimates that in 2017, the nation's dry natural gas production averaged 73.6 billion cubic feet per day. It's now forecasting 2018 production will reach 80.3 Bcf/d, "establishing a new record," EIA said. And EIA sees natural gas production increasing again in 2019, with forecast growth of 2.6 Bcf/d.
All of this comes as EIA predicts a steady increase in electricity from natural gas.
"EIA expects the share of U.S. total utility-scale electricity generation from natural-gas-fired power plants to rise from 32 percent in 2017 to 33 percent in 2018 and to 34 percent in 2019," the report said.
"The forecast generation share from coal in 2018 averages 30 percent, about the same as in 2017, but then falls to 29 percent in 2019," the report added.
Meanwhile, if you're looking for relief at the gas station, you'll have to wait a bit.
The report sees a gallon of regular averaging $2.61 this month, $2.69 in March, and $2.73 in April and May, before beginning a slow decline for the balance of the year.