Rystad: More gas leaving the U.S. economy, but markets look balanced

March 8 (UPI) -- More U.S. natural gas is leaving the market in the form of exports of liquefied natural gas, though the approach of spring could limit domestic demand to keep markets balanced, Norwegian energy consultant Rystad Energy reported Wednesday.

The amount of natural gas sent to terminals set a record at 13.5 billion cubic feet per day on March 4, supporting increased deliveries from the Freeport LNG export facility in Texas, Rystad data show.

A pipeline explosion in June forced Freeport offline for much of 2022, though it's slowly returning to full capacity after a lengthy federal review process.

A federal natural gas report showed 24 vessels loaded with LNG left U.S. export terminals during the seven-day period ending March 1 carrying a combined 88 billion cubic feet of gas in the liquid form. Of those, three left from Freeport.

"Freeport LNG's intake is ramping up quickly, signaling a U.S. gas export surge is imminent," said Emily McClain, the North America gas markets analyst at Rystad Energy, in a report emailed to UPI.

U.S. exports of LNG are supporting a European economy that broke away from Russian supplies last year in response to the invasion of Ukraine. The United States is expected to overtake Australia and Qatar this year to become the world leader in LNG exports.

For the U.S. economy, however, gas production is down 4% from December levels.

A lopsided market would normally lead to elevated prices for heating fuels such as natural gas. Severe winter weather was a weekly occurrence for much of February and temperatures remain well below freezing in the northern U.S. states.

Rystad, however, notes that spring may be approaching, which would lower domestic demand for heating fuels and keep the market in check.

"Domestic demand will likely stay subdued as warmer weather patterns emerge in the coming weeks," McClain said.

Henry Hub, the U.S. benchmark for the price of natural gas, flirted with $10 per million British thermal units last year as the global market adjusted to the loss of Russian supplies. Henry Hub was around $4 per million Btu in January, though the price was in the mid $2 range for Wednesday.