Natural Gas Price Inches Higher Following Storage Report

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The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 57 billion cubic feet for the week ending June 30. Analysts surveyed by S&P Global Platts were expecting a storage injection of between 43 billion and 64 billion cubic feet. The five-year average for the week is an injection of 72 billion cubic feet, and last year’s storage injection for the week totaled 61 billion cubic feet. Natural gas inventories rose by 72 billion cubic feet in the week ending June 30.

Natural gas futures for August delivery traded down about 1% in advance of the EIA’s report, at around $2.98 per million BTUs and inched up to around $2.99 shortly thereafter. The highest close for the past five trading days was registered Tuesday at $3.05. The 52-week range for natural gas is $2.82 to $3.62. One year ago the price for a million BTUs was around $3.11.

Domestic demand for natural gas in the week ahead is expected to be high as hot, high pressure systems dominate most of the United States. The Great Lakes area and the northeastern states will be spared until the middle of next week, when the hot temperatures spread across most of the country again. Overall demand will be high to very high, except in the northeastern states.

Stockpiles fell week over week to 8.9% below last year’s level, but they remain 6.2% above the five-year average.

The EIA reported that U.S. working stocks of natural gas totaled about 2.945 trillion cubic feet, around 172 billion cubic feet above the five-year average of 2.773 trillion cubic feet and 289 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 3.234 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 the latest report:

  • Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, traded down about 0.1%, at $80.95 in a 52-week range of $79.26 to $95.55.
  • Chesapeake Energy Corp. (NYSE: CHK) traded up about 1.2% to $4.72. The stock’s 52-week range is $4.27 to $8.20.
  • EOG Resources Inc. (NYSE: EOG) traded up 1% to $91.31. The 52-week range is $78.04 to $109.37.

Furthermore, the United States Natural Gas ETF (NYSEMKT: UNG) traded flat at $6.70, in a 52-week range of $6.33 to $9.74.