The Energy Information Administration (EIA) reported the season’s first withdrawal from natural gas storage inventories on Wednesday, an on-target 21 Bcf for the week ending Nov. 19.
The EIA’s weekly inventory report was published at noon ET on Wednesday because of the Thanksgiving Day holiday.
Natural gas futures prices were several cents higher in anticipation of the season’s first pull and strengthened further as the EIA figure confirmed some tightness in supply/demand balances. The December Nymex futures contract was hovering just above $5.00/MMBtu in the minutes leading up to the EIA report and then popped to around $5.04 as the print crossed trading desks. By 12:30 p.m. ET, the prompt month was trading at $5.086, up 11.9 cents from Tuesday’s close.
Ahead of the EIA report, a Reuters poll produced estimates that ranged from withdrawals of 16 Bcf to 31 Bcf, with a median of 22 Bcf. Eight estimates submitted to Bloomberg had a median withdrawal estimate of 24 Bcf and a range from 11 Bcf to 29 Bcf. The Wall Street Journal’s poll found withdrawal estimates of 11 Bcf to 25 Bcf, with an average of 20 Bcf. NGI modeled a 26 Bcf pull.
The 21 Bcf withdrawal compares with an 11 Bcf pull for the similar week, and the five-year average is a 44 Bcf withdrawal.
Broken down by region, Midwest stocks fell by 13 Bcf while East inventories were down by 11 Bcf, according to EIA. The Mountain region recorded a 2 Bcf withdrawal, but the Pacific posted a 1 Bcf injection.
The South Central region also continued to boost net inventories, with salt facilities increasing by 7 Bcf as the nonsalts pulled out 1 Bcf, EIA said.
Participants on The Desk’s online energy chat Enelyst said most regions’ net changes were in line with expectations. The East pulled out a little less than expected, but market observers chalked it up to unsupportive weather.
Of the overall withdrawal, one Enelyst participant said, “Quite solid on a wind week that did upper 50 average GWhs.”
Total working gas in storage as of Nov. 19 stood at 3,623 Bcf, which is 320 Bcf below year-ago levels and only 58 Bcf below the five-year average, according to EIA.
As for next week, Enelyst participants pegged the next draw to be much larger, with early estimates in the 50s Bcf and 60s Bcf. The Thanksgiving holiday impact was said to be a wild card, especially as production has increased throughout the week.
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