The U.S. Energy Information Administration (EIA) on Thursday reported an injection of 22 Bcf natural gas into storage for the week ended July 19. The result exceeded market expectations and kept pressure on Nymex natural gas futures.
Ahead of the EIA’s 10:30 a.m. ET report, the August futures contract was down a penny at $2.107/MMBtu. When the inventory data crossed the wire, the prompt month fell to $2.068. After another 30 minutes of trading, it was down 5.4 cents to $2.063.
Prior to the report, injection estimates submitted to Reuters ranged from 8 Bcf to 24 Bcf, with a median of 15 Bcf. A Bloomberg poll spanned 2 Bcf to 18 Bcf and landed at a median of 11 Bcf. NGI modeled an 11 Bcf increase.
Still, the result was light relative to recent history. It compared with an increase of 23 Bcf a year earlier and a five-year average build of 31 Bcf.
Gelber & Associates analyst Ryan Parsons said on the online energy platform Enelyst that exceptional levels of power need this month, including a 24% year/year spike in consumption from data centers, are keeping injections low relative to historical norms.
“July 2024 is already experiencing a record-breaking summer for natural gas power demand and we haven’t hit the peak,” Parsons said.
The increase for last week lifted inventories to 3,231 Bcf, keeping stocks above the year-earlier level of 2,982 Bcf and the five-year average of 2,775 Bcf.
The Midwest and East regions led with injections of 13 Bcf and 11 Bcf, respectively, according to EIA. Mountain region stocks increased by 3 Bcf, while Pacific inventories were flat.
The South Central, as it did a week earlier, reported a withdrawal. The region printed a pull of 6 Bcf that included a draw of 5 Bcf from salts and a 1 Bcf decrease in nonsalt stocks.
This South Center pull developed despite above average wind generation in Texas, according to NatGasWeather.
Looking ahead to the next EIA print, covering the week ending July 26, preliminary estimates submitted to Reuters ranged from additions of 15 Bcf to 51 Bcf, with an average increase of 39 Bcf.
The estimates compared with an increase of 15 Bcf during the comparable week last year and a five-year average increase of 33 Bcf.
