Natural Gas Storage Report - July 6
Posted: Fri Jul 06, 2018 10:25 am
Working gas in storage was 2,152 Bcf as of Friday, June 29, 2018, according to EIA estimates. This represents a net increase of 78 Bcf from the previous week. Stocks were 717 Bcf less than last year at this time and 493 Bcf below the five-year average of 2,645 Bcf. At 2,152 Bcf, total working gas is within the five-year historical range. < Very close to the bottom of the 5-year range and the U.S. gas market is MUCH LARGER than it was five years ago.
The build was larger than I expected, but just 5 Bcf above the 5-year average for this week. For the week ending July 6 the 5-year average build is 81 Bcf.
Since the end of April (nine weeks) the delta to the 5-year average has declined by a total of 27 Bcf or just 3 Bcf per week.
It will take a VERY MILD July across the eastern half of the U.S. to even come close to reducing the deficit to the 5-year average to 400 Bcf by the end of this month.
There are just 19 weeks remaining before the next winter heating season begins. 493 / 19 = 25.95
Is it likely that storage builds will exceed the 5-year average by 26 Bcf per week during the remaining refill season? I doubt it.
Conclusion: The Wall Street Gang does not focus on the "gassers" until after Labor Day. If natural gas in storage is 300 Bcf below the 5-year average in September (very likely), then I predict that the utilities will start bidding up the gas price because they must have secure supplies heading in the next winter. There is no doubt that we have a massive amount of natural gas in this country and supply is growing, but demand is also growing rapidly for industrial demand, power generation and for exports.
The build was larger than I expected, but just 5 Bcf above the 5-year average for this week. For the week ending July 6 the 5-year average build is 81 Bcf.
Since the end of April (nine weeks) the delta to the 5-year average has declined by a total of 27 Bcf or just 3 Bcf per week.
It will take a VERY MILD July across the eastern half of the U.S. to even come close to reducing the deficit to the 5-year average to 400 Bcf by the end of this month.
There are just 19 weeks remaining before the next winter heating season begins. 493 / 19 = 25.95
Is it likely that storage builds will exceed the 5-year average by 26 Bcf per week during the remaining refill season? I doubt it.
Conclusion: The Wall Street Gang does not focus on the "gassers" until after Labor Day. If natural gas in storage is 300 Bcf below the 5-year average in September (very likely), then I predict that the utilities will start bidding up the gas price because they must have secure supplies heading in the next winter. There is no doubt that we have a massive amount of natural gas in this country and supply is growing, but demand is also growing rapidly for industrial demand, power generation and for exports.