In 2020, natural gas spot prices at the national benchmark Henry Hub in Louisiana averaged $2.05 per million British thermal units (MMBtu), the lowest annual average price in decades. Prices started the year relatively low because mild winter weather led to less natural gas demand for space heating. Prices remained low as economic effects induced by the COVID-19 pandemic reduced both natural gas production and consumption.
Beginning in March, spring weather and responses to COVID-19 drove down natural gas demand, further lowering prices. The Henry Hub price averaged $1.66/MMBtu in June, the lowest monthly price in decades. Prices increased in the second half of the year because of lower natural gas production and an increase in LNG exports.
Consumption of natural gas in the United States decreased among residential, commercial, and industrial users. In contrast, natural gas use for electric power generation rose, based on the U.S. Energy Information Administration’s (EIA) monthly data through October 2020 and estimates for November and December.
