The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 75 billion cubic feet for the week ending May 19. Analysts were expecting a storage injection of 67 billion cubic feet. The five-year average for the week is an injection of around 90 billion cubic feet, and last year’s storage injection for the week totaled 71 billion cubic feet. Natural gas inventories rose by 68 billion cubic feet in the week ending May 12.
Natural gas futures for June delivery traded down by about 0.1% in advance of the EIA’s report, at around $3.20 per million BTUs, and slipped to $3.18 shortly thereafter. The highest close for the past five trading days was registered last Monday at $3.42. The 52-week range for natural gas is $2.81 to $3.64. One year ago the price for a million BTUs was around $2.93.
In a preview of this week’s report, Platts Analytics analyst Mitch DeRubis said:
Week-over-week fundamental estimates remained relatively stable, with U.S. natural gas supply tallying a total of 2 [billion cubic feet] less than the previous week and total demand estimates dropping by 3 [billion cubic feet]. On a more granular level, a reduction in residential and commercial demand of an estimated average 3 [billion cubic feet per day] was offset by an increase in power burn estimates of an average 3.2 [billion cubic feet per day].
Demand for the next week is expected to be moderate largely due to expected cooler temperatures into the weekend in the east-central and southern states. Temperatures remain high in the southwest and will warm again in the east and south.
Stockpiles fell week over week to 13.2% below last year’s level, but they remain 10.9% above the five-year average.
The EIA reported that U.S. working stocks of natural gas totaled about 2.444 trillion cubic feet, around 241 billion cubic feet above the five-year average of 2.203 trillion cubic feet and 371 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 2.815 trillion cubic feet for the same period a year ago.
Here’s how share prices of the largest U.S. natural gas producers reacted to this latest report:
- Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, traded up about 0.1% at $82.39 in a 52-week range of $80.30 to $95.55.
- Chesapeake Energy Corp. (NYSE: CHK) traded down about 0.3% to $5.53. The stock’s 52-week range is $3.93 to $8.20.
- EOG Resources Inc. (NYSE: EOG) traded up about 0.2% to $92.88. The 52-week range is $78.04 to $109.37.
Also, the United States Natural Gas ETF (NYSEMKT: UNG) traded down about 0.4%, at $7.40 in a 52-week range of $6.43 to $9.73.