U.S. natural gas production and demand will drop for a second year in a row in 2021 as economic fallout from the pandemic stifles the industry, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO) on Tuesday.
EIA projected dry gas production will drop to 90.50 billion cubic feet per day (bcfd) in 2021 from 91.29 bcfd in 2020 before rising to 90.96 bcfd in 2022. That compares with an all-time high of 93.06 bcfd in 2019.
It also projected gas consumption would fall to 81.71 bcfd in 2021 and 81.01 bcfd in 2022 from 83.31 bcfd in 2020. That compares with a record high of 85.15 bcfd in 2019.
If the outlook is correct, 2021 would mark the first time production falls for two consecutive years since 2005, and 2022 would be the first time consumption falls for three years since 1983.
EIA’s projections for 2021 in February were higher than its January forecasts of 88.17 bcfd for supply and 80.73 bcfd for demand.
The agency forecast U.S. liquefied natural gas exports would reach 8.46 bcfd in 2021 and 9.22 bcfd in 2022, up from a record 6.53 bcfd in 2020. That is lower than its January forecast of 8.48 bcfd in 2021.
The EIA projected U.S. coal production will rise to 589 million short tons in 2021 and 594 million short tons in 2022 from 539 million short tons in 2020, its lowest since 1965, as power plants burn more coal due to a forecast increase in gas prices.
The EIA projected carbon emissions from burning fossil fuels will rise to 4.754 billion tonnes in 2021 and 4.905 billion tonnes in 2022 as power generators burn more coal. That is up from 4.578 billion tonnes in 2020, which was the lowest since 1983.
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