Natural Gas Storage Report: Injection Season Week 9 (Week Ending June 2, 2017)

Mitch Marzuola, Energy Pricing Analyst

Despite the presupposition of warmer temperatures finally appearing alongside an above-average increase in power burns, this week’s build of 106 Bcf yet again exceeded market expectations of a 98 Bcf injection that simultaneously surpassed both last year’s value and the five-year average of 68 Bcf and 94 Bcf respectively. While the injection may considered bearish, it wasn’t enough of a difference to hinder the momentum of next week’s forecasted heat event taking place in the Midwest and East Coast markets. New natural gas export abilities, augmented domestic consumption, and deferred contracts maintained their steady influence in holding necessary support levels this week and combatted the recent downward trend, paving the way for the anticipated warmer weather to potentially bolster cooling demand as summer approaches.

Working natural gas inventories currently stand at 2,631 Bcf. This figure is 332 Bcf (11.2%) less than this time last year and 237 Bcf (9.9%) above the five year average.

The July 2017 NYMEX Futures price started at $3.02/MMBtu prior to the report’s release and has since risen to $3.04/MMBtu following the EIA report.

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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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