With traders and analysts continuing to digest the balance implications of the latest government storage data, natural gas futures were trading a few cents lower early Friday. The June Nymex contract was off 3.9 cents to $1.855/MMBtu at around 8:40 a.m. ET.

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The Energy Information Administration (EIA) on Thursday reported a 109 Bcf storage injection for the week ending May 1, on the high end of market estimates. The EIA figure compares with the 96 Bcf increase recorded in the same week last year and the five-year average build of 74 Bcf for the week.

Total working gas in storage as of May 1 was 2,319 Bcf, 796 Bcf above year-ago levels and 395 Bcf above the five-year average, EIA said.

“Compared to degree days and normal seasonality, this week’s injection appears loose by approximately 5 Bcf/d versus the prior five-year average,” Genscape Inc. analysts said. “…While 5 Bcf/d is still very loose versus normal, this week’s stat was meaningfully tighter than last week” and tighter compared to “the all-time record loose number from two weeks ago as production declines are beginning to tighten supply and demand balances.

“Recent declines in gas production are being driven by crude production, which has fallen by more than 1 million b/d since the end of March. Our production team estimates approximately 2 Bcf/d of associated gas for every million bbl/d of oil.”

Analysts at Raymond James & Associates Inc. estimated that the injection implies the market was 2.7 Bcf/d looser from a year ago when excluding weather-related demand. That’s versus an average of 3.2 Bcf/d looser over the past four weeks, according to the firm.

Balances have been “way too loose” for sustained price gains at the front of the curve, according to Bespoke Weather Services.

“Data will be more interesting over the next couple of weeks as parts of the economy attempt to reopen, which should help bring back a little demand, and with production still lower than it was prior to this week, that will tighten the balance somewhat,” Bespoke said. “The problem is that it needs to tighten significantly to lower the risk of completely filling storage this fall, and until we see signs of that, it is difficult to be bullish” for contracts at the front of the curve.

As for the latest forecast guidance, Bespoke said its outlook changed “very little” compared to previous expectations, with unseasonable cold in the Midwest and East the next few days, “including some record chill expected this weekend in some areas…Late next week the pattern changes to one where we see warming coming back into the eastern half of the nation, while the West cools down.”

June crude oil futures were trading 43 cents higher at $23.98/bbl at around 8:40 a.m. ET, while June RBOB gasoline was up fractionally to around 93.3 cents/gal.