The U.S. Energy Information Administration (EIA) on Thursday reported an injection of 41 Bcf natural gas into storage for the week ended July 14. The result fell shy of median expectations in polls and further fueled upward momentum for Nymex natural gas futures.
Ahead of the 10:30 a.m. ET EIA report, the August futures contract was up 13.8 cents at $2.741/MMBtu amid forecasts for extreme heat through July and into next month.
The prompt month held steady at around $2.736 when the EIA data was released. By 11 a.m. ET, however, it was up 15.7 cents to $2.760.
Prior to the report, NGI modeled a prescient 41 Bcf increase.
However, estimates submitted to Bloomberg spanned injections of 37 Bcf to 58 Bcf, with a median of 44 Bcf. Reuters’ polling landed at a median of 49 Bcf and found estimates ranging from injections of 41 Bcf to 58 Bcf. The Wall Street Journal’s survey generated a narrower range and an average build expectation of 47 Bcf.
EIA recorded a 35 Bcf build for the year-earlier period, and the five-year average was an increase of 45 Bcf.
Analysts on the online energy platform Enelyst noted that production has recently held below the 2023 high of about 102 Bcf/d. In July, output has wavered between 99 Bcf/d and 101 Bcf/d.
Additionally, Wood Mackenzie analyst Eric McGuire said strong gas power burns and scorching temperatures this month across much of the country also are proving bullish for prices and potentially for lighter storage injections ahead. This could help reduce surpluses to the five-year average that have concerned market participants since they developed amid a mild winter and spring.
“Our storage inventory situation looks much better than it did before the summer started,” McGuire said.
The increase for the last week lifted inventories to 2,971 Bcf. That compares with the year-earlier level of 2,396 Bcf and the five-year average of 2,611 Bcf.
The Midwest injection of 17 Bcf led all regions. The East followed with a build of 8 Bcf.
Pacific inventories rose by 7 Bcf, while Mountain region stocks increased by 6 Bcf.
The South Central injection of 3 Bcf included a 5 Bcf build in nonsalt facilities and a decrease of 2 Bcf in salts.
Looking ahead to the next EIA storage print, early estimates submitted to Reuters for the week ending July 21 ranged widely — from injections of 10 Bcf to 55 Bcf, with an average increase of 36 Bcf.
The projections compare with an increase of 18 Bcf during the same week last year and a five-year average of 31 Bcf.
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