EIA - Natural Gas Storage Report - Sept 14

[dan_s]

Working gas in storage was 3,205 Bcf as of Friday, September 8, 2023, according to EIA estimates.
This represents a net increase of 57 Bcf from the previous week. < Higher than my WAG of 50 Bcf
Stocks were 445 Bcf higher than last year at this time and 203 Bcf above the five-year average of 3,002 Bcf.
At 3,205 Bcf, total working gas is within the five-year historical range.

This is the 8th week in a row that the surplus to the 5-year average has declined; 168 Bcf in total. < This is very good.

There are ten more weeks in the refill season that ends November 17th.

My WAG for next week is a build of 65 Bcf, which compares to the 5-year average build of 87 Bcf. < As the weather begins to cool, storage builds will increase. Builds normally peak the last week of September. The average build for the week ending Sept. 29th is 104 Bcf.

In addition to the weather-related increase in demand for power generation, market forces are working to rebalance the U.S. natural gas market. However, we are still going to begin the 2023/2024 winter with ~350 Bcf more in storage than we had last year in mid-November. It will take a cold start to the winter to keep HH ngas over $3.00. El Nino winters tend to start mild and then get much colder than normal in Q1. By this time next year, with a colder than normal Q1 and more LNG export capacity coming online, I expect the "Right Price" for natural gas to be over $4.00. It is mostly about the weather, but market-forces (reduced gas well completions) are working in our favor. Demand for power generation and industrial demand are also expected to be higher in 2024.