Natural Gas Storage Report - July 3
Posted: Thu Jul 03, 2014 12:23 pm
Working gas in storage was 1,929 Bcf as of Friday, June 27, 2014, according to EIA estimates. This represents a net increase of 100 Bcf from the previous week. Stocks were 666 Bcf less than last year at this time and 790 Bcf below the 5-year average of 2,719 Bcf.
This should be the last triple digit storage increase we will see until the end of September. The heat is spreading across the South and demand gas for power generation is increasing. Demand peaks from mid-July through August.
The weekly increases to storage have been running approximately 20 bcf above the 5-year average for the last two months because of the cooler than normal weather. If we continue to have a cool summer AND storage builds continue to average 20 bcf higher than the average, we will start next winter with 3,300 to 3,400 bcf in storage when the next heating season begins. Last winter started with 3,834 bcf in storage.
I think natural gas will flop around in the $4.25 to $4.50 range for a couple more weeks, then start drifting higher. If real winter weather pushes across the Great Lakes in early December, we should see $5.00 gas by year-end.
This should be the last triple digit storage increase we will see until the end of September. The heat is spreading across the South and demand gas for power generation is increasing. Demand peaks from mid-July through August.
The weekly increases to storage have been running approximately 20 bcf above the 5-year average for the last two months because of the cooler than normal weather. If we continue to have a cool summer AND storage builds continue to average 20 bcf higher than the average, we will start next winter with 3,300 to 3,400 bcf in storage when the next heating season begins. Last winter started with 3,834 bcf in storage.
I think natural gas will flop around in the $4.25 to $4.50 range for a couple more weeks, then start drifting higher. If real winter weather pushes across the Great Lakes in early December, we should see $5.00 gas by year-end.