Forecasting Natural Gas Production and Consumption in United States-Evidence from SARIMA and SARIMAX Models

Abstract

Research on forecasting the seasonality and growth trend of natural gas (NG) production and consumption will help organize an analysis base for NG inspection and development, social issues, and allow industrials elements to operate effectively and reduce economic issues. In this situation, we handle a comparison structure on the application of different models in monthly NG production and consumption forecasting using the cross-correlation function and then analyze the association between exogenous variables. Moreover, the SARIMA-X model is tested for US monthly NG production and consumption prediction via the proposed method for the first time in the literature review in this study. The performance of that model has been compared with SARIMA (p, d, q) * (P, D, Q)s. The results from RMSE and MAPE indicate that the superiority of the best model. By applying this method, the US monthly NG production and consumption is forecast until 2025. The success of the proposed method allows the use of seasonality patterns. If this seasonal approach continues, the United States’ NG production (16%) and consumption (24%) are expected to increase by 2025. The results of this study provide effective information for decision-makers on NG production and consumption to be credible and to determine energy planning and future sustainable energy policies.

Keywords

• SARIMA
• SARIMAX
• natural gas production and consumption
• forecast