Refill

A cold beginning to spring that resulted in a tepid start to the natural gas storage refill season has analysts at the Energy Information Administration (EIA) once again revising their natural gas price forecasts upward for the rest of 2013 and 2014. The government agency added that strong onshore production growth will offset Gulf of Mexico declines in both years.

A cold beginning to spring that resulted in a tepid start to the natural gas storage refill season has analysts at the Energy Information Administration (EIA) once again revising their natural gas price forecasts upward for the rest of 2013 and 2014.

Forecasting another strong storage refill total for this week despite Hurricane Claudette’s shut-ins, Stephen Smith Energy Associates sees the natural gas storage deficit continuing to drop and pressures continuing to move prices down.

As Canada continues its own struggle to refill gas storage, the country’s southern neighbor is feeling the brunt of the impact in the form of severely reduced imports, according to Jefferies & Co. analyst Frank Bracken. For the first week of June, Canadian exports logged their lowest weekly level in six-years.

You’ve got to like the “I will not be pushed” mentality exhibited by the market Wednesday. Less than 24 hours after Federal Reserve Chairman Alan Greenspan told Congress that the nation has a long-term gas supply problem, natural gas futures turned lower as traders liquidated longs in hopes of taking advantage of short-term bearish rewards.

There’s a long summer ahead, but up to this point natural gas storage injections are going very well indeed, according to two independent analysts who now are projecting that, weather permitting, storage fill could reach the optimum levels of 2.8 to 3 Tcf by the start of winter.

There’s a long summer ahead, but up to this point natural gas storage injections are going very well indeed, according to two independent analysts who now are projecting that, weather permitting, storage fill could reach the optimum levels of 2.8 to 3 Tcf by the start of winter.

As shoulder-month natural gas futures prices soared past $6 last week, some market bears lambasted producers and analysts for a “propaganda campaign” that has “exaggerated” the low gas supply situation and the need for gas demand destruction this year (see NGI, May 12). The bears believe that it’s only a matter of time before the market realizes the folly of being at these prices during a shoulder month in a struggling economy. That realization may have started to take place last Thursday when prices began to tumble but stalled just above $6.

With shoulder-month natural gas futures prices topping $6 on Monday, it’s clear the bulls are winning the market tug-o-war. But some buyers charge that has happened through a propaganda campaign waged by producers and analysts who have exaggerated the low gas supply situation and the need for demand destruction.