Natural Gas Storage Report Injection Season Week 10 (Week Ending June 8, 2018)

Summer is in full swing  as we round out the initial third of Injection Season. Week 10 saw a slightly bearish number, as today the EIA reported an inflow of 96 Bcf – just under 7% higher than market calls for a 90 Bcf injection. Thus far, ever-increasing production has been able to keep pace with anomalously warm weather and the associated cooling demand, maintaining a resistance at $3.00/MMBtu. Expect this to be challenged, as market sentiments point to the next few weeks being pivotal in rebuilding our already lagging natural gas surplus. Near-term forecasts call for a slight break in the warmer weather across the nation, but a return to record matching cooling degree days is expected to follow shortly thereafter.

Working natural gas inventories currently stand at 1,913 Bcf. This figure is 785 Bcf (29.1%) lower than this time last year and 507 Bcf (20.9%) below the five year average.

The July 2018 NYMEX Futures price began the day at just under $2.96/MMBtu prior to the report’s release, dipped to $2.93/MMBtu after the report, but has since recovered to just over $2.95/MMBtu.

Outlook for the Balance of Storage Season:

The graph below compares historical 12, 24 and 36 month strip prices and storage levels for the past 5 years.

The following table shows the injection numbers we will need to average by week to hit selected historical levels:

The following two graphs show current natural gas in storage compared to each of the last 5 years and weekly storage averages and patterns.

The graph below shows the injections through the current week over the past 5 years.

Finally, the graphics below depicts the 6 to 10 day temperature range outlook from the National Weather Service.

Current Week’s Outlook

Future Outlook

Leave a Reply

Your email address will not be published. Required fields are marked *