Natural Gas Price Steady on Expected Withdrawal Size

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The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks decreased by 119 billion cubic feet for the week ending January 26.

Analysts were expecting a storage withdrawal of between 107 billion and 122 billion cubic feet. The five-year average for the week is a withdrawal of 151 billion cubic feet, and last year’s storage withdrawal for the week totaled 152 billion cubic feet. Natural gas inventories fell by 99 billion cubic feet in the week ending January 26.

Natural gas futures for March delivery traded up about 1.3% in advance of the EIA’s report, at around $2.74 per million BTUs, and it was essentially unchanged shortly afterward.

The forecast for overall natural gas demand continues to be “high” for the coming week as another blast of Arctic air drives across the north and east bringing low temperatures that could reach 10 degrees below zero Fahrenheit. Milder temperatures will follow throughout most of the country, except for the Rockies and Plains states where colder temperatures are forecast.

Total U.S. stockpiles fell week over week to 19.5% below last year’s level and are now also 15.9% below the five-year average.

The EIA reported that U.S. working stocks of natural gas totaled about 2.078 trillion cubic feet, around 393 billion below the five-year average of 2.471 trillion cubic feet and 503 billion below last year’s total for the same period. Working gas in storage totaled 2.581 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 0.1%, at $76.88 in a 52-week range of $76.05 to $89.30.
  • Chesapeake Energy Corp. (NYSE: CHK) traded up about 0.9%, at $2.90 in a 52-week range of $2.88 to $6.65. The low was posted earlier this morning.
  • EOG Resources Inc. (NYSE: EOG) traded up about 0.4% at $106.20. The 52-week range is $81.99 to $119.00.

Also, the United States Natural Gas ETF (NYSEARCA: UNG) traded up about 1.2% to $23.08, in a 52-week range of $20.40 to $31.84.