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Record US natural gas demand this winter led to increased storage withdrawal

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Tanks and Terminals,

Net withdrawals of natural gas from storage totalled 2264 billion ft3 this winter (from November 2021 to March 2022) – the highest winter natural gas withdrawal since the winter of 2017 – 2018 and 10% more than the five year (2016 – 2017 to 2020 – 2021) average winter draw according to the EIA's recently released Natural Gas Monthly.

Net natural gas withdrawals typically occur from November 2021 through to March 2022 as demand (consumption plus exports) exceeds supply (dry natural gas production plus imports), and natural gas must be drawn from storage to meet this excess demand. Working natural gas storage levels at the end of March 2022 were 1401 billion ft3, 11 billion ft3 higher than March 2018.

This past winter, US demand for natural gas exceeded supply of natural gas by an average 14.9 billion ft3/d. Averages of both US supply and demand of natural gas set records this past winter at 104.3 billion ft3/d and 119.2 billion ft3/d, respectively. However, the supply and demand imbalance was greater in the winter of 2017 – 2018, resulting in a larger withdrawal from natural gas storage compared with this past winter.

US dry natural gas production increased this winter compared with last winter and averaged 95.6 billion ft3/d, close to its highest winter level of 96.0 billion ft3/d in 2019 – 2020. Production has been generally increasing since 2020, after declining because of lower prices and reduced natural gas demand, but natural gas production during the winter did not reach its pre-COVID-19 pandemic level. Imports of natural gas also increased this winter, averaging 8.7 billion ft3/d.

US consumption of natural gas rose to 99.5 billion ft3/d this winter?just 0.4 billion ft3/d below the 2018 – 2019 winter record?because of higher natural gas consumption in the electric power sector, which rose by 2.0 billion ft3/d compared with last winter and by 2.5 billion ft3/d compared with the winter of 2018 – 2019. In addition, a colder-than-normal January contributed to above-average storage withdrawals for that month. Total demand, which includes domestic consumption and exports, was the highest on record this winter averaging 119.2 billion ft3/d. A 2.0 billion ft3/d rise in exports drove the growth, most of which was due to a 1.8 billion ft3/d rise in LNG exports.

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