Enverus Blog

Insights across the energy value chain

Natural gas storage inventories

decreased by 29 Bcf for the week ending March 30, according to the EIA’s weekly report. The EIA reported a 20 Bcf withdrawal and a non-flow-related adjustment that decreased working gas storage by another 9 Bcf in the South Central Nonsalt region. The 20 Bcf withdrawal was below market expectations. Natural gas prices are trading lower than yesterday’s close with the May contract trading at $2.66 per MMBtu at the time of writing.

Today’s storage withdrawal is lower than the 5-year average withdrawal of 27 Bcf, but last year saw an injection of 2 Bcf. Working gas storage inventories dropped to 1.35 Tcf, which is 697 Bcf below last year and 347 Bcf below the 5-year average.

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

Gas Prices Down as Inventories Decline by 29 Bcf Due to a Reclassification

This Week in Fundamentals

The summary below is based on PointLogic’s flow data and DI analysis for the week ending April 5, 2018.

  • Supply:
    • Dry gas production is down 0.1 Bcf/d week-on-week with the Northeast (-0.2 Bcf/d) and Rockies (-0.2 Bcf/d) declining while the Southeast (+0.2 Bcf/d) and Western (+0.1 Bcf/d) regions increased.
    • Canadian imports are up 0.3 Bcf/d week-on-week.
  • Demand:
    • Domestic natural gas demand is up 0.3 Bcf/d, with ResCom (+0.3 Bcf/d) and industrial (+0.2 Bcf/d) increasing while power declined (-0.2 Bcf/d).
    • Industrial gas consumption is showing an upward trend this year. Late last week EIA reported January industrial gas consumption at 24.8 Bcf/d, setting an all-time monthly record high for the second month in a row. December industrial consumption was 24.5 Bcf/d, and the previous record was 23.7 Bcf/d set in December 2016. States seeing the most gains are Louisiana, Texas, and Iowa.
    • LNG exports are up 0.6 Bcf/d and Mexico exports are up 0.4 Bcf/d week-on-week.
  • Total supply is up 0.3 Bcf/d, and total demand is up 2.3 Bcf/d. A larger withdrawal is expected next week. Last year saw an injection of 10 Bcf for the same week while the 5-year average is a 12 Bcf injection.
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