Enverus Blog

Insights across the energy value chain

Natural gas storage inventories decreased by 183 Bcf for the week ended Jan. 12, per EIA. The report is bearish, as the withdrawal came in below most market expectations. Natural gas prices declined following the release, with the February contract trading at $3.10 per MMBtu at time of writing.

Today’s storage withdrawal compares with a 243 Bcf draw reported last year and the 5-year average of 215 Bcf. Working gas storage inventories dropped to 2.584 Tcf, which is 368 Bcf below last year and 362 Bcf below the 5-year average.

See the chart below for projections of end-of-season storage inventories as of April 1, the end of the withdrawal season.

Bearish Gas Storage Report, Feb. 18 Remains Above  Mark

This Week in Fundamentals

The summary below is based on PointLogic’s flow data and DI analysis for the week ending Jan. 18, 2018.

  • Supply:
    • Dry gas production is down 0.5 Bcf/d week-on-week, bringing January-to-date production to an average of 74.9 Bcf/d. This is 1.7 Bcf/d lower than December, but 2.4 Bcf/d higher than the 2017 average.
    • Canadian imports are up 1.2 Bcf/d, as temperatures have cooled on the East Coast.
  • Demand:
    • Demand is up week-on-week, with lower temperatures and increased heating demand.
    • Domestic natural gas demand is up 17.8 Bcf/d, with ResCom increasing by 11.6 Bcf/d, power by 4.7 Bcf/d, and industrial by 1.6 Bcf/d.
    • LNG exports are up 1.1 Bcf/d, reversing the previous week’s decline as maintenance at the Gillis compressor station was completed.
  • Total supply is up 0.8 Bcf/d, and total demand is up 20.3 Bcf/d. A higher withdrawal is expected next week, in the mid-200 Bcf range. This draw compares with a 119 Bcf withdrawal reported last year and a 5-year average of 140.