Natural Gas Storage Report Injection Season Week 3 (Week Ending April 20, 2018)

The withdrawals have lasted yet another week. This marks the third week in a row that injection season has seen a withdrawal, and the current pull of 18 Bcf still managed to surpass the market expectation of 12 Bcf. Last year we saw an injection of 71 Bcf and the five year average stands at 60 Bcf. Another unusual withdrawal made the market increase the expiring May contract to as high as $2.814 and the June contract to $2.839. There were expectations in the range of 9 Bcf- 22 Bcf with some even expecting a small injection. Future weather outlooks are looking to be mild with 70’s and 80 degrees in most of the country. The Northeast is projected to have weather in the high 60’s  for places like New York and Boston. With these type of future mild temperatures  in the forecast, we can expect for the market to lean bearish as the short term support for the bulls might be coming to an end.

Current working natural gas inventories stands at 1,281 Bcf. This figure is 897 Bcf (41.2%) less than this time last year and 527 Bcf (29.1%) below the five year average.

The May 2018 NYMEX Futures price was $2.788/MMBtu prior to the report’s release and has since increased to $2.83/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Your email address will not be published.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 *