Energy Information Administration Weekly Storage Report
The EIA reported Thursday that domestic supplies of natural gas rose by 16 billion cubic feet for the week-ended June 11. The EIA said the data, however, included an adjustment to the week’s total to account for a reclassification of some gas stocks from working gas to base gas. Working gas is the volume of gas available in the market. The “implied flow for the week is an increase of 67 Bcf to working gas stocks,” the EIA said.
The EIA announced an implied build of 67 Bcf for the week, a few ticks below median estimates, but the reclassification created a huge headline miss that drove some traders to the sidelines.
Ahead of the report, analysts were looking for a lighter-than-usual storage injection with yesterday’s EIA inventory report. NGI’s model predicted a 74 Bcf injection for this week’s report.
Last year EIA recorded an 86 Bcf build for the similar week, and the five-year average is an injection of 87 Bcf.
Total stocks now stand at 2.427 trillion cubic feet (Tcf), down 453 Bcf from a year ago and 126 Bcf below the five-year average, the government said.
Weekly Weather Outlook
The American and European weather models showed a pattern for Tuesday through Friday of the coming week “not quite hot enough,” one that could result in “only moderate national demand,” according to NatGasWeather.
National demand will ease in the final full week of June, the forecaster added, “as weather systems track across the northern and east-central US.” However, substantial heat is still expected over the Southwest, while a drought in California could continue to minimize hydropower and put upward pressure on gas demand.
Weekly Forecast
Looking ahead to this week, early estimates call for a modest build that reflects the intense heat cooking the western United States in June, according to NGI.
Bespoke Weather Services estimated a 72 Bcf injection for the week-ended June 18; the five-year average is 83 Bcf. “We remain on pace for a high-end hot June overall, ranking in the top five hottest in the historical record,” the firm said.
Forecasters, however, said cooling needs could ease some this week – after two weeks of elevated demand, NGI wrote.