The U.S. Energy Information Administration (EIA) is slashing its winter Henry Hub spot price forecast on a combination of elevated production and weak space heating demand for natural gas so far this season.

EIA said in its latest Short-Term Energy Outlook (STEO) Tuesday it now expects the national benchmark to average $2.80/MMBtu this winter, down 60 cents from month-earlier projections.

With mild weather-driven demand and rising domestic output padding inventories, the agency also revised its projected end-March storage carryout to more than 2 Tcf, or 22% above the five-year average. In last month’s STEO, EIA had called for inventories to exit March 2024 at a little under the 2 Tcf threshold.

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