Natural gas storage inventories decreased by 86 Bcf for the week ending Mar. 16, according to the EIA’s weekly report. The draw was roughly in line with market expectations. Natural gas prices are trading in line with yesterday’s close, with the April contract trading at $2.63 per MMBtu at the time of writing.
Today’s storage withdrawal is lower than last year’s draw of 150 but higher than the five-year average of 47 Bcf. Working gas storage inventories dropped to 1.45 Tcf, which is 667 Bcf below last year and 329 Bcf below the five-year average.
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 PointLogic’s flow data and DI analysis for the week ending March. 22, 2018.
- Supply:
- Dry gas production is up 0.1 Bcf/d week-on-week. The Southeast (+0.1 Bcf/d) and Texas (+0.1 Bcf/d) increased production while the Northeast (-0.1 Bcf/d) decreased.
- Canadian imports are up 0.1 Bcf/d week-on-week due to continued cold weather on the East Coast.
- Demand:
- Domestic natural gas demand is down 2.0 Bcf/d, with ResCom (-1.6 Bcf/d) and industrial (-0.3 Bcf/d) decreasing while power was flat. Although the cold weather has persisted in the Northeast, the Southeast and Gulf regions saw less heating demand week-on-week.
- LNG exports are up 0.1 Bcf/d, and Mexico exports are down 0.1 Bcf/d week-on-week.
- Total supply is up 0.3 Bcf/d, and total demand is down 2.1 Bcf/d. A lower withdrawal is expected next week. Last year’s withdrawal for the same week was 43 Bcf, while the five-year average is 48.
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