Utilities injected 16 Bcf of natural gas into storage for the week ended July 21, government data released Thursday showed. The U.S. Energy Information Administration (EIA) print modestly exceeded expectations, keeping supplies stout and applying pressure on Nymex natural gas futures.
Ahead of the 10:30 a.m. ET report, the August futures contract was down 5.0 cents at $2.643/MMBtu. The prompt month slipped further to around $2.630 when the EIA data was released. By 11 a.m. ET, it was down 11.8 cents to $2.575.
Prior to the report, estimates submitted to Reuters ranged from injections of 8 Bcf to 36 Bcf, with a median increase of 15 Bcf. A Bloomberg poll produced a narrower range but with a low of 6 Bcf, and it landed at a median of 14 Bcf. The Wall Street Journal’s survey found an average injection expectation of 20 Bcf.
NGI modeled an increase of 14 Bcf.
EIA printed an increase of 18 Bcf for the comparable week last year and the five-year average injection was 31 Bcf.
“Temperatures were hotter versus normal over the western, southern and eastern U.S., while cool versus normal over the Midwest/Plains,” NatGasWeather said of conditions during the latest EIA report period.
The build for last week lifted inventories to 2,987 Bcf. That compared with the year-earlier level of 2,414 Bcf and the five-year average of 2,642 Bcf.
The Midwest and East regions led with injections of 16 Bcf and 9 Bcf, respectively, according to EIA. Mountain region stocks increased by 3 Bcf, while Pacific inventories were flat.
The South Central reported a net withdrawal of 11 Bcf. This reflected an 11 Bcf drop in salt facilities and flat nonsalt inventories. Texas has been one of the epicenters of extreme heat throughout the summer, with triple-digit highs commonplace and natural gas demand robust, explaining the need for utilities there to draw from underground supplies.
Looking ahead to next week, analysts are generally expecting a bullish storage result relative to historic norms, given blistering hot temperatures that are galvanizing ubiquitous air conditioner use across the Lower 48.
Early injection estimates submitted to Reuters for the week ending July 28 ranged from 14 Bcf to 35 Bcf, with an average increase of 24 Bcf. The projections compare with a five-year average of 37 Bcf.
