M-U Production Slides as Regional Cash Prices Sink Below $1/MMBtu

In September, production from the Marcellus and Utica shales averaged just under 35.1 Bcf/d --- down from a nearly two-year high at 35.3 Bcf/d in August, according to data from S&P Global Commodity Insights. Over the past three years, producers in the Marcellus/Utica have dialed back output in September. Why? Cooling temperatures that lead to falling gas demand which further leads to a crash in gas prices. How bad is the gas price crash? The Eastern Gas South trading hub near Pittsburgh, considered the benchmark for the M-U, saw cash prices trading around $0.80/MMBtu yesterday. Yes, 80 cents! The October gas contract at Eastern Gas South recently settled as low as $0.99/MMBtu. Ouch.

---

To view this content, log into your member account. (Not a member? Join Today!)