'Bullish' Storage Halts Bears in Their Tracks
Amid a swirl of pre-AGA storage speculation, the futures market
continued lower Wednesday, touching its lowest level so far this
month. After a lower opening, the July contract quickly mapped out
its high trade of the day at $2.36, before slipping 4 cents to
finish at $2.327. Estimated volume of 65,584 injected some life
into the market, following sub-45,000 trading sessions Monday and
Record setting temperatures in many East Coast cities last week
made the usual Wednesday exercise of predicting the weekly American
Gas Association Storage report a little more dicey this week.
Preliminary estimates ranged from as little as 65 Bcf to as much as
110 Bcf. So it was a surprise to most when the AGA said that 63 Bcf
was injected into underground storage facilities last week. And
because this year's injection figure neatly fell 41 Bcf short of
last year's 104 Bcf refill, it exactly erased to zero the
often-quoted year-on-year surplus which has hung over the market
However, one Midcontinent trader was unimpressed by the
smallness of the report. "The market zone has been most actively
injecting gas into storage the entire spring. Looks like they just
took the week off." He added that storage injectors are not
sweating the fact that refills are not keeping pace with last year.
"They are starting to come to the realization that the longer they
wait, the cheaper gas will become."
For now, that realization may have to wait because the market
was quick to react to the bullish news in last night's Access
session by jumping 2.8 cents higher to $2.355.
AGA Storage Surplus Vanishes
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