The Energy Information Administration (EIA) reported that a whopping 50 Bcf was injected into underground natural gas storage for the week ended April 15. While the bearish report already had been anticipated and factored into trading, May natural gas futures pushed slightly lower following the report, recording a trade at $6.88 as of 10:35 a.m. EST.

However, the $6.88 area held up once again Thursday as May natural gas climbed back above $7 to settle at $7.032, down only 2.5 cents on the day. The prompt month has tangled recently with the $6.88 support level and lost. Last Thursday the contract reached a low of $6.89 before rebounding higher. That was the case again this past Monday after May reached a low of $6.875.

In the Wednesday overnight Access session, traders had anticipated the sizeable build and had brought the prompt month back under the psychological $7 level to trade in the $6.93 area. Although the industry had been looking for a build in the 50 Bcf range, the injection more than doubled the five-year average injection of 23 Bcf and nearly doubled last year’s 26 Bcf build. The final ICAP-Nymex storage auction for the week, which ran from 3-4 p.m. ET on Wednesday, projected that the report would reveal a 49.9 Bcf injection.

“It’s really bounced off that $6.88 area pretty well here, but I think this market’s been pretty much a technical back and forth here the past few days,” said Steve Blair with Rafferty Technical Research in New York. “Our major support number is $6.80. We’ve had that number there for a while and it is a pretty major support area.”

Blair noted that there is nothing fundamental in the natural gas futures market and that the storage number Thursday — while higher than the averages — was really no big deal.

“I think there is a reason we are in this ping-pong range currently,” Blair said. “We are in the shoulder month right now of April where we are between the heating season and the cooling season. I think the next move in natural gas is going to be completely predicated off what weather does, which will dictate what kind of generation demand for natural gas is out there.”

He added that the early summer hot weather last week in a number of different parts of the country was likely one of the reasons natural gas futures were strong. “Now the heat is starting to go away and we are seeing a little more weakness,” Blair said. “I think this market at this point is looking for direction and I think the direction is going to come from weather.”

Some market experts believe the petroleum futures complex helped natural gas’ weakness Thursday morning. In its first day as prompt month, June crude was trading significantly lower in morning trade. However, crude ended the day by settling up 17 cents at $54.20/bbl, while May heating oil jumped 2.53 cents to close at $1.5340/gallon. While a number of market insiders are quick to point to a relationship, Blair said he believes the natural gas and petroleum tie is overplayed.

“I don’t think it is quite as strong a relationship as everybody seems to want to make it,” Blair said. “The relationship seems to be there to the upside at times, but it is like an on again-off again relationship. Look at the products Thursday as an example. May heating oil is up 2.5 cents at the end of the day here and natural is down 2.5 cents. I don’t think anyone could hang their hat on trading natural gas off of what petroleum is doing.”

Working gas in storage now stands at 1,343 Bcf, according to EIA estimates. Current stocks are 270 Bcf higher than last year at this time and 297 Bcf above the five-year average of 1,046 Bcf.

The East region led the injection charge with a 29 Bcf contribution to underground inventories, while the Producing and West regions added another 17 Bcf and 4 Bcf, respectively.

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