Ache within the fuel: Henry Hub costs fall under $2 for the primary time in 10 months

The darkish days are again once more for the US pure fuel market. Henry Hub fell under $2 at this time for the primary time since April 2023 when that stage was briefly breached 3 times.

In case you have a look at the final 23 years of US pure fuel costs, the interval under $2 have been temporary.

The shale revolution actually ramped up within the late 2010s and that is been a game-changer other than the temporary interval of excessive costs popping out of the pandemic.

This 12 months, there was an especially gentle winter in North America and that is crushed demand. There’s some gold within the 6-15 day US forecast however at this level, it is too little too late.

The killer is US manufacturing, which has stepped up 4-5% in every of the previous two years. There was a quick freeze-off in January however manufacturing is correct again to document ranges.

In the end, fracking is pure fuel extraction know-how and it is merely gotten too simple to get it out of the bottom. Even now, many US pure fuel fields ship sufficient oil and condensates to make up for near-zero income from pure fuel… so the pumping continues.

In some unspecified time in the future, fields will deplete, LNG exports will pick-up and US energy burn will match provide however seeing how simply producers ramped to 105 bcf/day from 92.0 bcf/day in 2021 makes it powerful to wager on fuel.