Natural gas report week, July 7, 2022.
This week’s injection of 60 Bcf came in at the low end of analysts’ expectations which ranged from 59 Bcf to 81 Bcf. Comparatively, last year’s injection was 25 Bcf and the five-year average of net injections is 60 Bcf. Current storage totals 2,311 Bcf which is 12.2% below the five-year average.
Prices were trending downward from last Wednesday – until Thursday, immediate to EIA publication of weekly storage numbers. While most analysts anticipated an above-average build, this week’s injection fell short, fueling apprehension about summer production’s ability to reduce the storage deficit to the five-year average in advance of winter heating season.
Demand - Total demand up 1.3 Bcf/d from last week, driven, in part by a 1.0 Bcf/d increase in cooling-related demand. Residential-commercial consumption, exports to Mexico, and LNG pipeline receipts also up over last week. LNG export ships add one, totaling 19 on the week for an overall capacity of 71 Bcf, up 5 Bcf from last week.
Production – Production and imports from Canada up minimally, each increasing 0.1 Bcf/d over the prior week. Likewise, overall supply up 0.1 Bcf/d.
Storage Forecast – The average rate of injections into storage is 4% 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 8.3 Bcf/d through October 31, natural gas supply will total 3,323 Bcf, 322 Bcf lower than the five-year average of 3,645 Bcf.
August settled Thursday at $6.297/Dth, up 78.7 cents from Wednesday’s close at $5.510/Dth and up 87.3 cents over the prior week.
Settled Thursday at $5.682/Dth, up 59.6 cents from the prior week.
The summer strip (AUG22-OCT22) settled at $6.271/Dth, up 86.3 cents from the week prior. The winter forward (NOV22-MAR23) settled Thursday at $6.248/Dth, up 74.8 cents from the week prior.
Calendar Years 2022/2023/2024
CY22 settled Thursday at $6.324/Dth, up 84.3 cents from the prior week.
CY23 settled Thursday at $5.023/Dth, up 32.9 cents from the prior week.
CY24 settled Thursday at $4.531/Dth, up 13.1 cents from the prior week.
Settled Thursday at $102.73/barrel, down $3.03 from the prior week.
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