Natural gas production in the U.S. has flattened since late 2011 according to a recent EIA report. The production slowdown is being blamed on soft natural gas prices and a historically high volume in storage.
Natural gas production set a record high during the first seven months of 2012 averaging 68.9 billion cubic feet per day. That is up 5.9% over the same period last year and the highest it has ever been. Month-to-month production outpaced last year's numbers but remained very near 2011 levels. The report expects data for August 2012 will show a slowdown in production as many offshore wells were shut in by Hurricane Isaac, and production took a pause.
Natural gas prices remain well below the 5-year average range and should continue to weigh on production. Natural gas liquids are fetching a better payoff than natural gas itself so producers will be looking to capitalize by targeting liquids-rich shale in the coming months.
Currently November Natural Gas trending to the upside, testing resistance at 3.55, falling to 3.40, and making its way back upward at present - Noon CT.