U.S. exporters are set to face over 110 liquefied natural gas (LNG) cargoes cancellations this summer, the EIA said in its latest Short-Term Energy Outlook (STEO).
The July report, released on Tuesday, said that more than 70 LNG export cargoes from the U.S. were canceled for June and July deliveries, and over 40 cargoes canceled for August deliveries.
These cancellations are expected to drive U.S. LNG exports down to an average of 3.6 billion cubic feet per day (Bcf/d) in June, 2.2 Bcf/d in July and August. The country’s 8.9 Bcf/d export LNG capacity will be running on 25% of its capacity, Kallanish Energy reports.
“EIA expects U.S. LNG exports to increase beginning in September and average 7.1 Bcf/d from December 2020-February 2021, as global natural gas demand gradually recovers,” the STEO stated.
In January, the U.S. exported 74 cargoes and through the first four months of the year, it shipped an average of 7.7 Bcf/d. However, between April and May, exports dropped 17% due to declining global gas demand and high inventories in Europe and Asia.
The historically low gas and LNG spot prices have also damaged the economic viability of U.S. LNG exports.
However, as more capacity comes online, the EIA expects LNG exports to increase to 5.4 Bcf/d this year, from 5 Bcf/d in 2019. Exports in 2021 are estimated to an average of 7.3 Bcf/d.
This post appeared first on Kallanish Energy News.