Natural gas futures worked lower but quickly recovered following an inventory report showing an increase in working gas storage that was well above what traders were anticipating.

For the week ended May 29, the Energy Information Administration (EIA) reported an injection of 132 Bcf in its 10:30 a.m. EDT release. July futures fell to a low of $2.556 after the number was released and by 10:45 a.m. July was trading at $2.618, down just 1.6 cents from Wednesday’s settlement.

Prior to the release of the data, analysts were looking for an increase closer to the 125 Bcf area. ICAP Energy had calculated a 126 Bcf increase, and Bentek Energy was looking for a build of 125 Bcf. A Reuters poll of 25 traders and analysts showed an average 121 Bcf with a range of a 101 Bcf to a 130 Bcf injection.

“I was hearing a 121 number, and one guy showed me a 129 Bcf figure, but I don’t think anyone was thinking this big,” a New York floor trader told NGI. “Immediately we got down to $2.556, but it bounced back 2.5 cents immediately. If you blinked you would have missed it; $2.50 is going to be a big number here.”

Tim Evans of Citi Futures Perspective said, “This was the second consecutive bearish weekly surprise, which tends to reinforce the idea that the background supply-demand balance has weakened from where it was just a few weeks ago. This has bearish implications for the data to follow, although it’s worth noting that today’s warmer temperature forecast will blunt some of that impact.”

Inventories now stand at 2,211 Bcf and are 751 Bcf greater than last year and 22 Bcf greater than the five-year average. In the East Region 73 Bcf was injected, and the West Region saw inventories increase by 14 Bcf. Stocks in the Producing Region grew by 45 Bcf.

The Producing Region salt cavern storage figure was up by 16 Bcf to 277 Bcf, while the non-salt cavern figure increased 30 Bcf to 668 Bcf.