EIA Natural Gas Storage Report - Sept 5

dan_s · Post by **dan_s** » Thu Sep 05, 2024 9:45 am

This is bullish. My WAG was a build of 29 Bcf for the week ending August 30.

Working gas in storage was 3,347 Bcf as of Friday, August 30, 2024, according to EIA estimates.
This represents a net increase of 13 Bcf from the previous week. < The 5-year average build for the last week of August is 63 Bcf.
Stocks were 208 Bcf higher than last year at this time and 323 Bcf above the five-year average of 3,024 Bcf.
At 3,347 Bcf, total working gas is within the five-year historical range.

Market Forces and increasing LNG export capacity should have storage back to normal by mid-November (the beginning of draws for space heating)

During the 19 weeks since April 19th, storage builds have been less than the 5-year average 18 of 19 weeks and the total decline in the storage surplus to the 5-year average has declined by 372 Bcf. This weel's 50 Bcf difference to the 5-year average is way above forecasts.

There are 11 weeks remaining in the Refill Season that will end November 15th.
Based on my WAG (Wild Ass Guess) the surplus will decline by another 270 Bcf, and the winter of 2024/2025 will begin with a tiny surplus of just 53 Bcf. That is a "Rounding Error".

Keep in mind that:
> Today demand for U.S. natural gas is MUCH HIGHER than it was five years ago.
> Two more large LNG export facilities are coming on line before winter begins (Plaquemines and Corpus Christi Train 3)
> We have had two mild winters in the Eastern U.S. in a row. The forecast is for a colder than normal winter in the Eastern U.S. this year.
> We are one normal winter away from MUCH HIGHER natural gas prices in the U.S.

My forecasts are based on HH natural gas prices averaging $2.50 in Q4 2024 and $3.50 in 2025.

It is very important that you know the production mix (oil, ngas and NGLs) of each company you own. I show the mix for each company in our three model portfolios on the Sweet 16 Summary Excel spreadsheet (Tabs 2 and 3). You can find it under the Sweet 16 tab on the EPG website. I update it each weekend.