The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 65 billion cubic feet for the week ending October 27. Analysts were expecting a storage injection of between 60 billion and 70 billion cubic feet. The five-year average for the week is an injection of 60 billion cubic feet, and last year’s storage injection for the week totaled 54 billion cubic feet. Natural gas inventories rose by 64 billion cubic feet in the week ending October 20.
Last week marked the end of the EIA’s official natural gas injection season. From now until April is the withdrawal season, when stocks are drawn down to provide winter heating. About half of all U.S. homes are heated with natural gas.
Natural gas futures for December delivery traded up about 0.9% in advance of the EIA’s report, at around $2.92 per million BTUs, and traded up slightly at $2.94 shortly after the report was released. The highest close for the past five trading days was registered last Thursday at $3.05. The 52-week range for natural gas is $2.85 to $3.75. One year ago the price for a million BTUs was around $3.18.
Demand for the next seven days is expected to remain moderate as the southern and eastern states continue seeing warm temperatures through early next week. Rain and snow are forecast for the northwest and north central states, with a weather system bringing cooler temperatures to the Great Lakes and northeast by the middle of next week.
Total U.S. stockpiles fell week over week to 4.6% below last year’s level and remain 1.1% below the five-year average.
The EIA reported that U.S. working stocks of natural gas totaled about 3.775 trillion cubic feet, around 41 billion cubic feet below the five-year average of 3.816 trillion cubic feet and 180 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 3.955 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 today’s report:
- Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, traded down about 0.8%, at $83.18 in a 52-week range of $76.05 to $93.22.
- Chesapeake Energy Corp. (NYSE: CHK) traded down about 5.1%, at $3.76 in a 52-week range of $3.41 to $8.20. The company reported third-quarter results this morning that were not well-received by investors.
- EOG Resources Inc. (NYSE: EOG) traded down about 0.1% to $102.20. The 52-week range is $81.99 to $109.37.
Furthermore, the United States Natural Gas ETF (NYSEARCA: UNG) traded up about 1.2% at $6.04 in a 52-week range of $5.92 to $9.74.