Natural Gas Storage: -2 Bcf
Inventories post the second straight small withdrawal before the onset of unseasonable cold in the Midwest and East.
The U.S. Energy Information Administration reported a weekly withdrawal of 2 Billion Cubic Feet (Bcf) in Lower 48 natural gas storage inventories for the week ending November 22, 2024 (Link). Total inventories now stand at 3,967 Bcf, 134 Bcf (3.5%) above year-ago levels and 267 Bcf (7.2%) above the 2019-2023 average for the same week.
The drawdown of natural gas storage inventories continued during the third week of November, with another single-digit net deduction reported by the EIA. The 2-Bcf draw was virtually in line with the 3-Bcf pull recorded during the previous week, indicating little change in the supply and demand balance. The small withdrawal was in contrast with the 5-Bcf injection reported for the same week in 2023 and came up well shy of the 30-Bcf draw in the five-year average. Market participants were expecting a small withdraw or small build for the report week, with the range of published forecasts spanning from a draw of 14 Bcf to a build of 9 Bcf. The actual number came in slightly bullish compared to the consensus forecast calling for a 1-Bcf injection.
NYMEX natural gas futures have been trading in a volatile manner over the past week, with large daily swings becoming commonplace since the front of the curve broke out above $3.00 per MMBtu on November 20. Most of the price action is being driven by shifts in near-term temperature outlooks, with traders trying to assess how long the upcoming cold snap will stick around in the populous eastern half of the country. Today’s storage number did little to alter market sentiment, as the prompt-month January 2025 contract was down sharply prior to the report based on early indications of a potential warming pattern beyond the first week of December. Prices have pushed to new daily lows in the wake of the EIA report, but there was no notable immediate reaction to the new storage data.
At the time of publication, the January 2025 NYMEX futures contract was trading at $3.223 per MMBtu, down $0.244 per MMBtu from yesterday’s settlement.
Stocks were drawn lower in every region outside of the South Central, with small deductions reported in the East, Midwest, Mountain, and Pacific. Inventories grew by 10 Bcf in the South Central, with Salt storage accounting for 6 Bcf and Nonsalt the other 4 Bcf.
Storage withdrawals are likely to ramp up considerably starting with next week’s report. Residential and commercial demand has started to rise and will increase more significantly as unseasonable cold sets in later this week. Pinebrook Energy Advisors forecasts and end-of-winter storage level between 1.9 and 2.0 Tcf, with that outcome highly variable dependent on realized weather patterns in the coming months.
Detailed Data with Updated Charts in the Natural Gas Storage Report PDF Below:
