US natural gas production and consumption were in balance in 2012

8 Jan 2013 by Jim Fickett.

Over the last decade, US natural gas production has, as everyone knows, grown faster than consumption:

Note, though, that in 2012 production and consumption were in almost perfect balance and growing at the same rate. As more businesses (especially electric power utilities) have taken advantage of cheap natural gas, the market has come back to balance.

(Data is through October 2012, the latest available. All amounts shown are 12-month moving averages, since seasonal variation is high.)

Net imports have been in steady decline since 2008. However net imports are still positive, so that the absolute amount of gas in storage is still growing. However, consumption is also growing, and the amount of gas in storage is shrinking in terms of months of supply. Storage in months of supply is now almost exactly at its 10-year average.

This is a complex market, and consumption, in particular, is a noisy series. So I'll not make any forecasts. However it is encouraging that there is no excess of gas, when properly measured, and the market seems to be in an ongoing balance now. As drilling remains low for now, and there are many plans in the works to use more gas, it is possible we are finally getting close to a turnaround for the gas producers.