Thursday, June 25, 2020

EIA Natural Gas Storage Report, June 25: Yikes

First up, FX Empire with the pre-release estimates:
...According to Natural Gas Intelligence (NGI), a Bloomberg poll found injection estimates ranging from 100 Bcf to 114 Bcf, with a median of 108 Bcf. A Wall Street Journal survey produced an average build expectation of 105 Bcf, while a Reuters survey of 17 analysts produced a 90 Bcf to 115 Bcf injection range and a median 106 Bcf injection. NGI estimated a 116 Bcf build for the report.
The bearish expectations compare with a build of 103 Bcf during the same week a year earlier and the five-year average build of 73 Bcf for that week...
From the Energy Information Administration, the report:
.Working gas in storage was 3,012 Bcf as of Friday, June 19, 2020, according to EIA estimates. This represents a net increase of 120 Bcf from the previous week. Stocks were 739 Bcf higher than last year at this time and 466 Bcf above the five-year average of 2,546 Bcf. At 3,012 Bcf, total working gas is within the five-year historical range....MORE
And finally, from the NYMEX, the price action, 30-minute bars over the last week:

That low print was at $1.463 which is something like a thirty year low.
FX Empire goes on to talk about the decline in LNG exports from the U.S. but our readers have known about that for the last four or five weeks, a couple times per week.

What I haven't stressed enough, and the basis for our expectation of $3.50 gas some time this year was how fast the shale oil industry resumed drilling and pumping, bringing up all the "associated gas" with it and leading to posts such as:
June 19
Uh Oh, Shades of Oil in Cushing: Natural Gas Storage at Henry Hub Close to Full
June 1
"EIA forecasts lower U.S. natural gas consumption in 2020"
May 22
Rystad Energy: "US Lower 48 gas production to bottom out in November".

See also, if interested:
$2 Natural Gas in Europe
"Buyers of U.S. LNG to Cancel 40-45 Cargoes"
EIA Natural Gas Weekly Update (LNG Shipments Lowest in 3 Years)
Bloomberg: Natural Gas May Trade Below Zero In Europe
There are many more, use the 'search blog' box for the rest
And all the warm weather went to northern Russia for the summer.
We'll have cooling degree days and all the rest in tomorrow morning's EIA Weekly Update.