Working gas in storage was 2,845 Bcf as of Friday, July 26, 2013, according to EIA estimates. This represents a net increase of 59 Bcf from the previous week. Stocks were 368 Bcf less than last year at this time and 34 Bcf below the 5-year average of 2,879 Bcf.
Slightly bearish. I was looking for a net increase under 50 bcf. We need to see smaller increases the next 2-3 weeks.
Natural Gas Storage Report - August 1
Natural Gas Storage Report - August 1
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Natural Gas Storage Report - August 1
Injection Report Bearish
By Dominick Chirichella (writer for CME Group) - Thu 01 Aug 2013 10:56:12 CT
Nat Gas futures getting hit with a modest level of post inventory selling after a larger than expected injection into inventory (see below for a detailed inventory discussion). The injection level is starting to rise as the weather over major portions of the US has turned to unseasonably cooler than normal temperatures. With the weather forecasters calling for a cooler than normal first half of August the injections going forward are also likely to continue to increase relative to both last year and the five year average with the inventory deficit expected to continue to narrow versus last year and the five year average.
From a technical viewpoint the spot contract is breaking down and is now trading below the $3.41/mmbtu support level and back to price levels not seen (on a continuation chart basis) since February of 2013. The next area of technical support is around the $3.20/mmbtu level with a growing likelihood that the spot contract could eventually test the $3.10/mmbtu. With the weather continuing to be mostly bearish for weather related Nat Gas consumption the probability of Nat Gas continuing to move lower is becoming more probable by the day.
Thursday's EIA report was bearish versus the market consensus and versus the so called normal five year average and compared to last year. The report showed a net injection that was above the market consensus, greater than last year and above the five year average net injection for the same period. The 59 BCF injection (above normal for this time of the year) was about 3 BCF above the market consensus calling for an injection of around 56 BCF. The build of 59 BCF was above my model forecast (50 BCF injection) this week. The year over year inventory situation remains in a deficit position versus last year but has narrowed this week with the deficit versus the more normal five year average also narrowing. The current inventory deficit came in at 34 BCF versus the normal five year average or about a negative 1.2 percent
By Dominick Chirichella (writer for CME Group) - Thu 01 Aug 2013 10:56:12 CT
Nat Gas futures getting hit with a modest level of post inventory selling after a larger than expected injection into inventory (see below for a detailed inventory discussion). The injection level is starting to rise as the weather over major portions of the US has turned to unseasonably cooler than normal temperatures. With the weather forecasters calling for a cooler than normal first half of August the injections going forward are also likely to continue to increase relative to both last year and the five year average with the inventory deficit expected to continue to narrow versus last year and the five year average.
From a technical viewpoint the spot contract is breaking down and is now trading below the $3.41/mmbtu support level and back to price levels not seen (on a continuation chart basis) since February of 2013. The next area of technical support is around the $3.20/mmbtu level with a growing likelihood that the spot contract could eventually test the $3.10/mmbtu. With the weather continuing to be mostly bearish for weather related Nat Gas consumption the probability of Nat Gas continuing to move lower is becoming more probable by the day.
Thursday's EIA report was bearish versus the market consensus and versus the so called normal five year average and compared to last year. The report showed a net injection that was above the market consensus, greater than last year and above the five year average net injection for the same period. The 59 BCF injection (above normal for this time of the year) was about 3 BCF above the market consensus calling for an injection of around 56 BCF. The build of 59 BCF was above my model forecast (50 BCF injection) this week. The year over year inventory situation remains in a deficit position versus last year but has narrowed this week with the deficit versus the more normal five year average also narrowing. The current inventory deficit came in at 34 BCF versus the normal five year average or about a negative 1.2 percent
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Natural Gas Storage Report - August 1
a hot summer we are not going to have, except in sw. we have to depend on a cold winter now.
jim
jim
Re: Natural Gas Storage Report - August 1
Total inventories are now at 66.7 percent of maximum workable storage capacity (maximum workable capacity revised upward by EIA) with the Consuming East region at 61.3 percent of maximum. This compares to storage sitting at 75.3 percent of capacity last year at this time. There is certainly not going to be any capacity limitations this year during the injection season as inventories are starting the injection season at a below normal level.
This means Ngas prices should hold near current levels unless the weekly storage reports get a lot worse. We will not see the price collapse like it did last summer.
This means Ngas prices should hold near current levels unless the weekly storage reports get a lot worse. We will not see the price collapse like it did last summer.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group