Natural Gas Storage Report: Injection Season Week 25 (Week Ending September 22, 2017)

Cliff McGaha, Energy Markets Analyst

Fall is officially here, but the generally solid builds continue. Friday, September 22nd marked the end of Week 25 of injection season, and today the EIA reported a net inflow of 58 Bcf – bullish compared to the expectation of 66 Bcf. By comparison, 52 Bcf was injected this time last year, and the five year average stands at 86 Bcf. Though the report came in bullish, traders saw this as a benign event, and near-prompt natural gas futures traded sideways within a 3 cent band for the remainder of the day. The reason for this lack of reaction to a surprising report is due to trading Winter month contracts this late in a shoulder month span. As cooling demand through the major power burn markets diminishes, expectations call for a strong finish though October and the remainder of Injection Season.
 
Working natural gas inventories currently stand at 3,466 Bcf. This figure is 127 Bcf (3.7%) less than this time last year and 41 Bcf (1.1%) above the five year average.
 
The November 2017 NYMEX Future was depressed to $3.04/MmBTU prior to the report’s release but dropped to just over $3.02/MmBTU afterward.

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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.

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

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

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

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

Current Week's Outlook
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Future Outlook
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