Natural Gas Price Ticks Up Following Inventory Report

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The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks decreased by 124 billion cubic feet for the week ending February 16.

Analysts were expecting a storage withdrawal between 112 billion and 128 billion cubic feet. The five-year average for the week is a withdrawal of 145 billion cubic feet, and last year’s storage withdrawal for the week totaled 89 billion cubic feet. Natural gas inventories fell by 194 billion cubic feet in the week ending February 9.

Natural gas futures for March delivery traded down about 0.3% in advance of the EIA’s report, at around $2.65 per million BTUs, and $2.66 shortly after the report was released.

The forecast for overall natural gas demand next week once again calls for “moderate” demand as temperatures remain mild in East and South. Warmer temperatures are expected over most of the country next week, with the exception of the western and central states, where temperatures are forecast to be below normal with more snow on the way.

Total U.S. stockpiles fell week over week to 25.7% below last year’s level and are now 19% below the five-year average.

The EIA reported that U.S. working stocks of natural gas totaled about 1.760 trillion cubic feet at the end of last week, around 412 billion cubic feet below the five-year average of 2.172 trillion cubic feet and 609 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 2.369 trillion cubic feet for the same period a year ago.

Here’s how share prices of the largest U.S. natural gas producers reacted the latest report:

  • Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, traded up about 0.9%, at $75.53 in a 52-week range of $73.90 to $89.30.
  • Chesapeake Energy Corp. (NYSE: CHK) traded up nearly 19%, at $3.13 in a 52-week range of $2.53 to $6.59. The company reported better-than-expected earnings this morning.
  • EOG Resources Inc. (NYSE: EOG) traded up about 1.1% to $106.91. The 52-week range is $81.99 to $119.00.

Furthermore, the United States Natural Gas ETF (NYSEARCA: UNG) traded up about 0.1%, at $22.32 in a 52-week range of $20.40 to $31.72.