The U.S. Energy Information Administration (EIA) revealed in its April Short Term Energy Outlook (STEO) on Tuesday that natural gas production in the United States is expected to decline in 2024, coinciding with a projected surge in demand to a record high.
EIA forecasts a decrease in dry gas production from a peak of 103.80 billion cubic feet per day (bcfd) in 2023 to 103.58 bcfd in 2024, as several producers scale back drilling activities following a period of low gas prices earlier in the year. The agency anticipates a rebound in output to 104.88 bcfd by 2025.
Simultaneously, domestic gas consumption is projected to increase from a record 89.09 bcfd in 2023 to 89.92 bcfd in 2024 before easing to 89.12 bcfd in 2025.
If these forecasts materialize, 2024 would mark the first decline in natural gas production since the onset of the COVID-19 pandemic in 2020, while also representing the first consecutive four-year rise in demand since 2016.
The latest projections for 2024 surpass EIA’s previous estimates from March, indicating higher supply at 103.35 bcfd and greater demand at 89.68 bcfd.
Moreover, EIA foresees average U.S. liquefied natural gas (LNG) exports reaching 12.15 bcfd in 2024 and escalating to 14.30 bcfd in 2025, surpassing the record of 11.90 bcfd set in 2023.
The agency also predicts a decline in U.S. coal production from a two-year low of 581.6 million short tons in 2023 to 485.2 million tons in 2024 – the lowest since 1963 – and further down to 464.2 million tons in 2025, the lowest since 1962, as coal-fired plants face displacement by gas and renewable energy sources.
EIA has revised its forecast for U.S. coal exports downward following the closure of the Port of Baltimore due to the collapse of the Francis Scott Key bridge. The agency projects coal exports to decrease from a five-year high of 99.8 million short tons in 2023 to 94.5 million short tons in 2024 before rebounding to 104.9 million short tons in 2025.
Additionally, EIA anticipates a decline in carbon dioxide (CO2) emissions from fossil fuels, from 4.807 billion metric tons in 2023 to 4.781 billion metric tons in 2024 and further down to 4.738 billion metric tons in 2025, driven by reductions in coal usage and overall fossil fuel consumption.