A rebound in demand for ethane as a key feedstock for petrochemical manufacturing should fuel production growth through 2021, according to the Energy Information Administration (EIA).

Ethane, Crude Oil, and Natural Gas Production Forecast

EIA forecasted in its August Short-Term Energy Outlook that ethane production would exceed 2 million b/d by the fourth quarter. That would mark a 9% increase from the start of 2020. The agency expects ethane production to continue to advance at a similar pace in 2021 and approach 2.27 million b/d by year-end, 18% higher than first quarter levels this year.

Ethane is separated from natural gas at processing plants along with other natural gas liquids (NGL) such as propane and butane. NGL prices plunged alongside the collapse of crude oil in March, when the coronavirus pandemic took hold in the...