bp posted on Tuesday a 17% year-on-year decline in its natural gas production and realized gas prices during the third quarter of 2020, Kallanish Energy reports.

The British energy giant reported net gas production of 6.45 billion cubic feet per day (Bcf/d) during the July-September period, compared with 7.79 Bcf/d in 3Q19. The volume performed slightly better when compared to the previous quarter, at 6.72 Bcf/d.

Production in Europe surged 24.5% y-o-y to 188 million cubic feet per day (Mmcf/d), but it was more than offset by the 29.5% fall in U.S. production, which reached 608 Mmcf/d in Q3. Elsewhere, bp saw its natural gas output falling by 7.1% to average 1.44 Bcf/d.

The reductions reflect divestments in BPX Energy and Alaska, but also lower associated natural gas production due to Covid-19 triggered lower demand.

During this period, its average realized gas prices was $2.56 per thousand cubic feet (Mcf), which is in line with prices in the previous quarter, but also 17% lower than prices in 3Q19.

Looking ahead, bp said U.S. gas supply is expected to continue on a declining trend in 2021, largely due to a drop in associated gas production.

Tightening gas balances have recently caused the prompt price to rise, and the futures curve for Henry Hub now averages above $3 for 2021. “This would be expected to provide some support to pricing in Europe and Asia until more gas comes to market,” bp said in its financial results statement.

This post appeared first on Kallanish Energy News.