Nia Williams of Reuters tells her readers that summer air conditioning demand is waning, and storage levels are nearly full; she warned that prices would struggle until colder weather starts in late October. Williams writes:
Canadian natural gas prices slumped to their lowest level in more than two years on Monday and are expected to remain under pressure for weeks, as storage levels in Alberta reach full capacity due to weak demand across North America.
Next-day gas prices at the AECO hub in Alberta fell to 5 Canadian cents per million British thermal units (mmBtu), their lowest level since August 2022, according to data from financial firm LSEG.
The AECO benchmark has been trending lower throughout 2024 following a mild winter that left Canada, the world’s sixth-largest natural gas producer, with a significant surplus of supply. […]
He estimated 700 million to 800 million cubic feet a day of gas is currently offline, taking production to around 17.3 billion cubic feet a day (bcf/d) this month. Canada’s production year-to-date has averaged 18.1 bcf/d.
Many producers and analysts are looking ahead to the start-up of the Shell-led (SHEL.L), LNG Canada project in northern British Columbia next year as a major new source of 2.1 bcf/d of demand that will help the AECO market recover.
“We are expecting natural gas prices to be pulled higher over the winter and early 2025 with growing demand from LNG export capacity increasing,” Eight Capital analysts said in a research note.
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