EIA - Natural Gas Storage Report - Dec 21

[dan_s]

Working gas in storage was 3,577 Bcf as of Friday, December 15, 2023, according to EIA estimates.
This represents a net decrease of 87 Bcf from the previous week.
Stocks were 240 Bcf higher than last year at this time and 280 Bcf above the five-year average of 3,297 Bcf.
At 3,577 Bcf, total working gas is within the five-year historical range.

For the three weeks ending Dec 15 (21 days) the draws from storage totaled 259 Bcf, which compares to the 5-year average draws of 269 Bcf for the same three weeks. We should start seeing triple digit draws going forward.

Last winter EIA reported draws of 213 Bcf and 221 Bcf for the last two weeks of December. That's not going to happen this year, so the delta to last year's storage level will expand by the end of December.

Last winter weather in January turned extremely mild and EIA reported an 11 Bcf increase in storage for the week ending January 5, 2023. Today it looks like January 2024 weather will be much colder in the eastern half of the U.S. Draws close to the 5-year average in January this winter should wipe out the surplus to where storage was the year before by the end of January. In previous Januarys we've seen a few weekly storage draws of more than 300 Bcf. If we are lucky enough to get one of those cold weeks this winter, HH ngas should spike to over $3.00.

This 10-Day forecast https://weather.com/maps/tendayforecast is showing cold air spreading eastward by the end of December.

Natural Gas Prices are weather driven: Just a normal January should take ~800 Bcf out of storage. Add one "Polar Vortex" and we could see January draws over a Tcf.

Chicago is the "Bull's Eye" for space heating demand. When daytime highs in Chicago go below freezing, the weekly draws should go over 200 Bcf. It takes cold waves that drive deep into the Southeast to get 300 Bcf draws.

[dan_s]

Something else to consider is that demand for U.S. natural gas is much higher than it was five years ago.

Global demand for natural gas is growing much faster than demand for oil. As our LNG export capacity grows, we will need more gas in storage to meet spikes in demand.