Working gas in storage was 3,476 Bcf as of Friday, December 29, 2023, according to EIA estimates.
This represents a net decrease of 14 Bcf from the previous week.
Stocks were 553 Bcf higher than last year at this time and 399 Bcf above the five-year average of 3,077 Bcf.
At 3,476 Bcf, total working gas is above the five-year historical range.
This is a surprisingly low draw from storage and more surprising is that the ngas price did not crash shortly after it came out.
So, why didn't ngas trade much lower after the report came out?
> Traders are now focused on the winter storms crossing the country.
> The next 3 storage reports will be MUCH LARGER DRAWS than EIA reported last year.
> Next week's report will compare to an 11 bcf storage build last year.
> By January 19th the storage surplus to last year could be under 200 Bcf (from 553 Bcf at December 29th).
EIA - Natural Gas Storage Report - Jan 4
EIA - Natural Gas Storage Report - Jan 4
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA - Natural Gas Storage Report - Jan 4
New weather forecast drawing attention.
"Computer models are hinting at the possibility of a significant cold snap for the western and central United States in about eight to 10 days.
It appears that a large dip in the jet stream will allow bitter Arctic air to surge south, causing temperatures to drop well below normal. Models don’t yet agree on the severity of this potential cold air outbreak, nor on how far east the chill will extend.
As cold penetrates a growing area of the Lower 48 states, the potential for snow will increase toward the middle of the month in the southern tier, which has yet to experience much wintry weather this season."
"Computer models are hinting at the possibility of a significant cold snap for the western and central United States in about eight to 10 days.
It appears that a large dip in the jet stream will allow bitter Arctic air to surge south, causing temperatures to drop well below normal. Models don’t yet agree on the severity of this potential cold air outbreak, nor on how far east the chill will extend.
As cold penetrates a growing area of the Lower 48 states, the potential for snow will increase toward the middle of the month in the southern tier, which has yet to experience much wintry weather this season."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA - Natural Gas Storage Report - Jan 4
I think this was was the weakest storage report for this week since 2005.
Need some big draws in the comming months to eat into the 5-year average surplus.
Need some big draws in the comming months to eat into the 5-year average surplus.
Re: EIA - Natural Gas Storage Report - Jan 4
I am working on EQT's forecast model today. They have an interesting slide (#25) in their most recent presentation. It points out that looking at the amount of ngas in storage compared to the 5-year average is misleading because demand for U.S. ngas is much higher than it was five years ago and growing much faster than the global demand for oil.
Per EQT: U.S. Natural Gas Storage Capacity
> Total ngas storage capacity relative to demand for U.S. ngas is near an all-time low.
> Despite absolute gas inventories being above the 5-year average, when compared to daily demand, storage is near the all-time low of ~25 Days of coverage in mid-November.
> Since 2008, U.S. ngas in storage has been within the range of 18 to 95 Days of coverage. During January (since 2008) gas in U.S. storage has ranged from 22 to 75 Days of Coverage. Today there is less than 30 Days of Coverage in storage.
I agree 100% that we need some big draws from storage during January for HH ngas prices to move over $3.00. Looks like a Polar Vortex will bring Artic Air deep into the South by Jan 15. Each time I check the 10-Day forecast, it gets more bullish for ngas demand.
Keep in mind that EIA's weekly reports often have some weird numbers during the week of Christmas.
Per EQT: U.S. Natural Gas Storage Capacity
> Total ngas storage capacity relative to demand for U.S. ngas is near an all-time low.
> Despite absolute gas inventories being above the 5-year average, when compared to daily demand, storage is near the all-time low of ~25 Days of coverage in mid-November.
> Since 2008, U.S. ngas in storage has been within the range of 18 to 95 Days of coverage. During January (since 2008) gas in U.S. storage has ranged from 22 to 75 Days of Coverage. Today there is less than 30 Days of Coverage in storage.
I agree 100% that we need some big draws from storage during January for HH ngas prices to move over $3.00. Looks like a Polar Vortex will bring Artic Air deep into the South by Jan 15. Each time I check the 10-Day forecast, it gets more bullish for ngas demand.
Keep in mind that EIA's weekly reports often have some weird numbers during the week of Christmas.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA - Natural Gas Storage Report - Jan 4
Possible draw for next week estimated at -115 to -120