The natural gas futures market received a piece of supportive news Friday morning after the Energy Information Administration (EIA) reported that 191 Bcf had been withdrawn from storage for the week ending Feb. 5. The report was viewed as slightly bullish as most industry estimates were for a draw of approximately 180 Bcf. March natural gas futures closed Friday at $5.468, up 7.2 cents from Thursday but 4.7 cents lower than the previous week’s finish.

Before the 10:30 a.m. EST report, which had been delayed from Thursday due to the blizzard that struck Washington, DC, March natural gas futures were trading at $5.326. However, in the minute prior to the release, the prompt-month contract plunged to a low of $5.204, only to bounce all of the way back and then some following the bullish data. Just five minutes after the report futures were trading at $5.459. As of 11 a.m. EST, the contract was trading at $5.487, up 9.1 cents from Thursday’s close.

While Citi Futures Perspective analyst Tim Evans deemed the draw as “bullish,” he noted that the key is whether it can meaningfully spark prices. “The draw of 191 Bcf was above the consensus expectation and a clear step higher from our own 165 Bcf forecast, so supportive relative to the degree day accumulations for the week,” he said. “However, we’ll still have to see whether the market has any success in translating this supportive data into higher prices. So far the market has rebounded smartly from the lower level traded just ahead of the numbers, but we still see the overall tone here as soft…”

Despite the bullish inventory news, some traders are still skeptical that there will be enough winter left to suck down storage supplies and spike prices. “The way I see it is we’re entering the third week of February, which puts us a little more than a month away from the official start of spring on March 20,” said a New York broker. “Yes, we are likely to see maybe one or two more withdrawals of 200 Bcf or more due to the recent stretch of cold, but I’m not convinced that will be enough to turn the tides on the whole equation. The bottom line is we have a lot of gas on hand and the production supply lines — aided by new shale plays — show no signs of slowing down.”

Heading into the report, a Reuters survey of 26 industry players produced withdrawal expectations of between 160 Bcf to 202 Bcf with an average expectation of 180 Bcf. Bentek Energy projected a withdrawal of 182 Bcf. The actual 191 Bcf draw came in well above both last year’s date-adjusted 164 Bcf pull and the 156 Bcf five-year average.

According to the EIA, working gas in storage stood at 2,215 Bcf as of Feb. 5. Stocks are now 172 Bcf higher than last year at this time and 114 Bcf above the five-year average of 2,101 Bcf. The frigid East Region led the withdrawal charge for the week by removing 116 Bcf, while the Producing and West regions withdrew 60 Bcf and 15 Bcf, respectively.

“We’re still viewing this market as one that can’t seem to gather much momentum in either direction,” said Jim Ritterbusch of Ritterbusch and Associates. “However, we will note the inability to advance this month off an apparent bullish weather factor. This is sending off some negative vibes that could ultimately result in a test of the $5 support area.”

Economy watchers were certainly not displeased with the 8:30 a.m. EST Friday release of January retail sales figures by the Commerce Department. The economic barometer was expected to be 0.5% higher on a month-to-month basis, a healthy improvement over December’s minus 0.3% showing. The actual figure came in as expected at 0.5%. Both March Standard and Poor’s Stock Index Futures and March natural gas showed little change after the release of the data.

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