Working gas in storage was 3,386 Bcf as of Friday, September 20, 2013, according to EIA estimates. This represents a net increase of 87 Bcf from the previous week. Stocks were 179 Bcf less than last year at this time and 30 Bcf above the 5-year average of 3,356 Bcf.
Slightly larger build than expected, but normal for this time of year ("Shoulder Season").
Natural Gas Storage Report - Sept 26
Natural Gas Storage Report - Sept 26
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Natural Gas Storage Report - Sept 26
From CME Group
NG drifting lower in quiet trading
By Dominick Chirichella - Fri 27 Sep 2013 09:32:43 CT
The Nat Gas sell-off did not last very long after a bearish weekly inventory report as the October contract expired. In what can only be described (in my view) as a technical short covering rally the new spot November contract ended the session around the unchanged level. The November contract is starting its life as the spot contract in the $3.50 to $3.605/mmbtu trading range. At the moment I do not see any significant fundamental support that would propel prices much higher. The market is currently in a technical trading pattern that will call out for fundamental support sooner than later.
On the fundamental side the tropics remain relatively quiet with a new low probability weather event has popped up about 1,000 miles east of the Lesser Antilles. Conditions are only marginal conducive for further development over the next several days. For now this event is not projected to move to the oil and Nat Gas producing region of the US Gulf of Mexico.
In the short term weather outlook the latest NOAA six to ten day and eight to fourteen day forecasts are neutral in my view as more of the US is now projected to experience normal fall like weather. In addition as we saw with yesterdays over performance in the injection rate the above normal temperatures experienced over the last several weeks did not result in a significant amount of cooling related Nat Gas demand (see below for more comments on demand). As such with the shoulder season now in clear view I would expect the going forward weekly inventory injections to continue to over perform the historical data heading into the upcoming winter heating season.
In the EIA weekly Nat Gas report Targa completes Galena Park liquefied petroleum gas (LPG) export terminal expansion. Earlier in the month, Targa completed its Galena Park export terminal expansion, increasing its LPG export capabilities by 20,000 barrels per day. If used at capacity, the Galena Park expansion could increase LPG exports by 7% compared with recent volumes. This could also provide price support for propane and butane going forward. Most U.S. LPG exports are propane (about 90%), with normal butane accounting for the rest.
Consumption declined during the report week. According to data from Bentek Energy LLC, total consumption fell 5.6%, driven by a steep decrease in consumption for power generation in every region of the country. With weather moderating, air conditioning loads have dropped off. Consumption of gas for power generation in the Southeast, Texas, and the Northeast, the three largest consumers of natural gas in this sector, decreased by 12.1%, 25.7%, and 12.5%, respectively. Industrial and residential/commercial demand both increased, rising by 1.0% and 2.7%, respectively. Pipeline exports to Mexico rose by 16.6% over the report week, but accounted for a relatively small component of natural gas disposition.
Supply declined during the report week, but less steeply than consumption. Bentek reported that total supply fell 1.3%, driven by a production decline of 1.2%. Northwest and Midwest reductions in gas imports from Canada led to a decline in total gas imports from Canada of 4.4%. Canadian flows to the U.S. Northeast were flat at near zero. Imports of LNG were up for the report week, with shipments arriving in the Sabine Pass Terminal in the Gulf Coast on Tuesday and Wednesday, but totals remained close to historical lows.
NG drifting lower in quiet trading
By Dominick Chirichella - Fri 27 Sep 2013 09:32:43 CT
The Nat Gas sell-off did not last very long after a bearish weekly inventory report as the October contract expired. In what can only be described (in my view) as a technical short covering rally the new spot November contract ended the session around the unchanged level. The November contract is starting its life as the spot contract in the $3.50 to $3.605/mmbtu trading range. At the moment I do not see any significant fundamental support that would propel prices much higher. The market is currently in a technical trading pattern that will call out for fundamental support sooner than later.
On the fundamental side the tropics remain relatively quiet with a new low probability weather event has popped up about 1,000 miles east of the Lesser Antilles. Conditions are only marginal conducive for further development over the next several days. For now this event is not projected to move to the oil and Nat Gas producing region of the US Gulf of Mexico.
In the short term weather outlook the latest NOAA six to ten day and eight to fourteen day forecasts are neutral in my view as more of the US is now projected to experience normal fall like weather. In addition as we saw with yesterdays over performance in the injection rate the above normal temperatures experienced over the last several weeks did not result in a significant amount of cooling related Nat Gas demand (see below for more comments on demand). As such with the shoulder season now in clear view I would expect the going forward weekly inventory injections to continue to over perform the historical data heading into the upcoming winter heating season.
In the EIA weekly Nat Gas report Targa completes Galena Park liquefied petroleum gas (LPG) export terminal expansion. Earlier in the month, Targa completed its Galena Park export terminal expansion, increasing its LPG export capabilities by 20,000 barrels per day. If used at capacity, the Galena Park expansion could increase LPG exports by 7% compared with recent volumes. This could also provide price support for propane and butane going forward. Most U.S. LPG exports are propane (about 90%), with normal butane accounting for the rest.
Consumption declined during the report week. According to data from Bentek Energy LLC, total consumption fell 5.6%, driven by a steep decrease in consumption for power generation in every region of the country. With weather moderating, air conditioning loads have dropped off. Consumption of gas for power generation in the Southeast, Texas, and the Northeast, the three largest consumers of natural gas in this sector, decreased by 12.1%, 25.7%, and 12.5%, respectively. Industrial and residential/commercial demand both increased, rising by 1.0% and 2.7%, respectively. Pipeline exports to Mexico rose by 16.6% over the report week, but accounted for a relatively small component of natural gas disposition.
Supply declined during the report week, but less steeply than consumption. Bentek reported that total supply fell 1.3%, driven by a production decline of 1.2%. Northwest and Midwest reductions in gas imports from Canada led to a decline in total gas imports from Canada of 4.4%. Canadian flows to the U.S. Northeast were flat at near zero. Imports of LNG were up for the report week, with shipments arriving in the Sabine Pass Terminal in the Gulf Coast on Tuesday and Wednesday, but totals remained close to historical lows.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group