Natural gas report week, July 21, 2022.

This week’s injection of 32 Bcf came in under analysts’ expectations which ranged from 34 Bcf to 59 Bcf. Comparatively, last year’s injection was 50 Bcf and the five-year average of net injections is 41 Bcf. Current storage totals 2,401 Bcf which is 12.0% below the five-year average but still within the five-year historical range.

The heat wave led to an increase in consumption for natural gas used in power generation, specifically due to additional cooling demand. This, in turn, resulted in a storage injection that fell short of projections. It likewise marked the first widening in the storage deficit to the five-year average in weeks prompting pessimism about end-of-season storage totals.

Natural Gas Weekly Fundamentals

Demand-Total demand is up 2.1 Bcf/d from last week as cooling related consumption continued to rise, growing 1.6 Bcf/d over last week. LNG export ships fell by seven, totaling 16 on the week for an overall capacity of 61 Bcf, down 23 Bcf from last week.

Production – Production remains stagnant, adding only 0.6 Bcf from last week. 

Storage Forecast –The average rate of injections into storage is 5% lower than the five-year average at this point in refill season (which traditionally runs April through October). If the injection rate matches the five-year average of 8.5 Bcf/d through October 31, natural gas supply will total 3,317 Bcf, 328 Bcf lower than the five-year average of 3,645 Bcf.

Natural Gas Market Report – July 21, 2022

August NYMEX

August settled Thursday at $7.932/Dth, down 7.5 cents from Wednesday’s close at $8.007/Dth and up $1.332 over the prior week.

 

 

12 Month Strip

Settled Thursday at $6.755/Dth, up 87.9 cents from the prior week.

Seasonal Strips

The summer strip (AUG22-OCT22) settled at $7.844/Dth, up $1.306 from the week prior. The winter forward (NOV22-MAR23) settled Thursday at $7.582/Dth, up $1.102 from the week prior.

 

Calendar Years 2022/2023/2024

CY22 settled Thursday at $7.865/Dth, up $1.276 from the prior week.
CY23 settled Thursday at $5.595/Dth, up 45.2 cents from the prior week.
CY24 settled Thursday at $4.692/Dth, up 11.9 cents from the prior week.

Crude Oil

Settled Thursday at $96.35/barrel, up $3.52 from the prior week.

 

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