The Energy Information Administration (EIA) reported a 59 Bcf withdrawal from natural gas storage inventories for the week ending Nov. 26, which included the Thanksgiving holiday.
The draw was nearly dead on with estimates ahead of the EIA report, but much steeper than historical pulls. This initially helped to maintain a modest boost seen along the natural gas futures curve early Thursday, but it failed to spur any additional excitement.
After plunging more than $1 over the prior three sessions, the January Nymex contract was trading about a penny higher day/day at around $4.270/MMBtu ahead of the EIA report. The prompt month then popped up to $4.285 as the EIA print crossed trading desks. However, by 11 a.m. ET, it was at $4.254, down four-tenths of a cent from Wednesday’s close.
Bespoke Weather Services said the 59 Bcf draw “is a very neutral number, doing nothing to alter the picture.” The figure reflects balances being a little tighter than the five-year average, according to the firm. Its model is pointing to an end-of-season storage level around 1,550 Bcf.
Bespoke cautioned that the end-March estimate is subject to moving higher if the warmer pattern forecast through at least mid-December persists even longer, “which seems likely, at least for awhile.” The forecaster said there were few changes in the latest models, which still reflect “a very warm forecast…” This month is seen rivaling December 2006 as the “second warmest December on record in terms of total gas-weighted degree days. December 2015 is No. 1 and probably unreachable.”
The relatively muted price action following the EIA report reflected the lack of surprises in the data. Ahead of the report, major surveys had coalesced around a withdrawal in the high 50s Bcf. The median projection in Bloomberg and Reuters polls was a 58 Bcf pull. NGI also modeled a 58 Bcf draw.
The EIA recorded a small 4 Bcf withdrawal in the year-earlier period and the five-year average is a 31 Bcf draw. The prior week’s EIA report showed a 21 Bcf pull.
Broken down by region, the Midwest withdrew 23 Bcf from storage and the East pulled 22 Bcf, according to EIA. South Central inventories fell by a net 12 Bcf, including a 3 Bcf decline in salt facilities and an 8 Bcf drop in nonsalts. The Pacific reported a 1 Bcf increase in stocks.
Looking ahead to next week’s EIA report, early estimates were for a withdrawal in the 40s Bcf and 50s Bcf.
Total working gas in storage as of Nov. 26 was 3,564 Bcf, which is 375 Bcf less than last year at this time and 86 Bcf below the five-year average of 3,650 Bcf.
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