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Gas Draw Season Nears an End as Summer Season Approaches


Natural gas storage inventories decreased 36 Bcf for the week ending March 22, according to the EIA’s weekly report. This draw is slightly above the market expectation, which was an inventory decrease of 32 Bcf.

Working gas storage inventories now sit at 1.107 Tcf, which is 285 Bcf below inventories at the same time last year and 551 Bcf below the five-year average.

At the time of this writing, the May 2019 contract was trading at $2.726/MMBtu, $0.007 above yesterday’s close of $2.719/MMBtu. The April 2019 contract closed on Wednesday at $2.713/MMBtu.

As April approaches and the winter season comes to an end, storage draws are ending as well — unlike in 2018, when withdrawals were reported through most of April. According to the current ICE Financial Weekly Index report, injections are expected to be reported for the next two weeks. Increased production year-over-year is expected to be a key factor in helping offset the inventory deficit to the five-year average. However, other factors, such as weather, will play a large role throughout the summer in overcoming the deficit.

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

This Week in Fundamentals

The summary below is based on Bloomberg’s flow data and DI analysis for the week ending March 28, 2019.


  • Dry gas production increased 0.90 Bcf/d on the week. Increases in the South Central/Gulf (+0.45 Bcf/d) and Mountain (+0.51 Bcf/d) regions drove the gains. Within the South Central/Gulf region, gains were mainly spread across Louisiana (+0.27 Bcf/d) and Texas (+0.19 Bcf/d). The Mountain region showed gains in Colorado (+0.21 Bcf/d), New Mexico (+0.18 Bcf/d), and North Dakota (+0.10 Bcf/d).
  • Canadian net imports decreased 0.48 Bcf/d on the week. Import decreases were seen across the Midwest and Pacific regions.


  • Domestic natural gas demand decreased 4.80 Bcf/d week-over-week. Res/Com demand decreased 3.51 Bcf/d week-over-week, while Power and Industrial demand increased 0.60 Bcf/d and 0.63 Bcf/d, respectively.
  • LNG exports decreased 1.37 Bcf/d, mainly due to maintenance at Sabine Pass. Mexican exports fell 0.03 Bcf/d on the week.

Total supply is up 0.43 Bcf/d, while total demand decreased 3.46 Bcf/d week over week. The EIA is expected to report the first injection of the season next week, with the ICE Financial Weekly Index report currently expecting an injection of 13 Bcf. Last year, the same week saw a draw of 29 Bcf; the five-year average is 14 Bcf.

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