Natural Gas Storage Report: Injection Season Week 23 (Week Ending Sept 7th, 2018)

Blake Derrick
Energy Pricing Analyst

The injection of 69 bcf fell in line with several survey ranges, most notably with Reuters (60-76) and EBW Analytics Group who accurately forecasted the below than average build number. The injection is less than the 87 BCF reported this time last year as well as the 5 year average of 76 bcf. Per NGI, this is due to the impending impact of Hurricane Florence as it approaches land. There is an expectation of a major loss of demand due to extended power outages and that the nuclear fleet located in the Carolinas could be shut down due to flooding. However most expect that Florence, which has now fallen to a category two status, will not be as extreme as Hurricane Irma which severely ravaged Florida over several days. Per EIA, 2 of the 11 nuclear power plants in Georgia, North Carolina, South Carolina, or Virginia were operating at slightly reduced levels: one unit of the Brunswick plant (operating at 88% of capacity) and one unit of the McGuire plant (99%), both of which are in North Carolina. In 2017, nuclear power provided 36% of the electricity generated in those four states.

Working natural gas in storage is currently 2,636 bcf which is 662 bcf (-20.1) less than last year at this time and 596 bcf (19.5%) below the five-year average of 3,232 bcf.

Natural gas futures for October delivery traded up about a penny in advance of the EIA’s report, at around $2.83 per million BTUs, and it rose to about $2.85 shortly after the report was released.

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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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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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