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The Greater Houston Partnership has issued the following press release:
The closing spot price for West Texas Intermediate (WTI), the U.S. benchmark for light, sweet crude, averaged $71.39 per barrel in December ’21, up from $46.30 for the same period in ’20, according to the U.S. Energy Information Administration (EIA). December ’21 marked the third consecutive month for WTI to average over $70, a trend that hasn’t occurred since the fracking boom ended in ’14.
WTI prices fell for most of November ’21 due to a number of factors, the first being increases in production from the United States and the Organization of Petroleum Exporting Countries and its allies (collectively known as OPEC+). Also affecting prices were concerns about the Omicron variant affecting demand and the U.S. release of 50 million barrels from the strategic petroleum reserves. Early December WTI prices averaged $66.80 per barrel before climbing to $76.05 at the end of the month. December’s increase in price occurred as the Omicron concerns eased and as Libya experienced production disruptions, thus reducing supply.
Oil prices rose during most of ’21 amid falling global inventories. For the 12 months ending December ’21, WTI averaged $68.05 per barrel, a 73.5 percent increase from $39.22 in ’20.
After increasing for much of ’21, Henry Hub natural gas prices dropped in December largely due to warmer-than-expected weather across much of the country. Prices averaged $3.76 per million British thermal units (MMBtu) in November, up 45.2 percent from $2.59 in December the prior year. In ’21, gas prices averaged $3.91 per MMBtu, compared to $2.04 for ’20.
In its January ’22 Short-Term Energy Outlook, the EIA forecasts WTI to average $71.32 per barrel and Henry Hub natural gas spot prices to average $3.79/MMBtu in ’22.