After seesawing on Friday morning from a low of $4.287 just prior to the regular session’s open to a high of $4.454 just prior to the 10:30 a.m. EST release of fresh storage data, December natural gas futures knee-jerked lower after the Energy Information Administration (EIA) revealed that 25 Bcf had been injected into underground storage for the week ending Nov. 6. However, the move was short-lived.

Heading into the report, most industry expectations were for an injection in the high teens to low 20s Bcf. The prompt-month contract immediately after the report’s release dropped to $4.344 but rebounded from there to $4.459 as of 11 a.m. EST. December futures went on to close the regular session at $4.392, up 2.2 cents from Thursday’s finish but 20.3 cents lower than the previous week’s close.

“The injection is meaningless. We’ve got more than 3.8 Tcf in the ground, which means storage is full,” said Ed Kennedy, a broker with Hencorp Futures LC. “It is like blowing up a balloon. There is a finite amount of air that you can put in a balloon. It is the same with gas and the storage fields. You also have to keep an eye on December because some of the utility contracts with the storage fields have guaranteed pulls starting Dec. 1. The only place you can cycle gas is in the Producing Region.”

While storage is a nonconversation, according to Kennedy, he said weather is at the top of the list of importance for traders. “It looks like we’re still going to see temperatures that are slightly warmer than normal for the near term, so I don’t see the bulls gaining any real traction. I know the Henry Hub cash price [Friday was] at $2.53, which puts futures at nearly a $2 premium. Now, that price is for the low-demand weekend, but I also think excess gas that can’t get into storage is hitting the cash market. It is very, very quiet in futures…Looking at the current ladder the largest order out there is 20 lots, which is nothing. Volume is very light.”

Citi Futures Perspective’s Tim Evans called the injection “higher than expected” and “bearish,” while noting that it confirms who is in the driver’s seat. “This suggests that some volume greater than expected was able to find a space within the dwindling spare storage capacity,” he said. “This report does not necessarily change the larger fundamental landscape, but it does reinforce the established bearish sentiment.”

Evans had been expecting a 20 Bcf injection, while a Reuters survey of 25 industry players produced an injection expectation range of 10 Bcf to 23 Bcf with an average build expectation of 18 Bcf. Bentek Energy projected an injection of 21 Bcf. The actual 25 Bcf build was smaller than both the 54 Bcf addition from the similar week last year and the 30 Bcf five-year average build.

As of Nov. 6 working gas in storage stood at 3,813 Bcf, according to EIA estimates. Stocks are 350 Bcf higher than last year at this time and 409 Bcf above the five-year average of 3,404 Bcf. The Producing Region deposited 10 Bcf while the East and West regions chipped in 8 Bcf and 7 Bcf, respectively.

Some traders see the market in need of some kind of positive event. “Thursday’s move was more of a technical move to the downside. There is still a lot of gas out there, and can the market go lower? Yes,” said John Woods, senior trader at Integrity Energy in New York.

He added that a short-term market bottom might be found at the “$4.25 area, and when you look lower that’s about where you land. For this market to show any strength it is going to have to show something constructive — that being weather or usage — and it’s just not there. You have to take into account that industrial demand has been taken out of this market this year because of the economy.”

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