Natural Gas Price Ticks Higher After Inventory Report

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The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks decreased by 78 billion cubic feet for the week ending February 23.

Analysts were expecting a storage withdrawal between 68 billion and 78 billion cubic feet. The five-year average for the week is a withdrawal of 118 billion cubic feet, and last year’s storage increase for the week totaled 7 billion cubic feet. Natural gas inventories fell by 124 billion cubic feet in the week ending February 16.

Natural gas futures for April delivery traded up about 0.4% in advance of the EIA’s report, at around $2.68 per million BTUs, and at $2.70 shortly after the report was released.

The forecast for overall natural gas demand next week remains in the “moderate” range as temperatures remain mild in East and South. Some cooler and wetter weather is on tap in the eastern states, but it is expected to be followed by milder weather and temperatures. Colder weather is in store for the West, including California.

Total U.S. stockpiles fell week over week to 28.8% below last year’s level and are now 18.1% below the five-year average.

The EIA reported that U.S. working stocks of natural gas totaled about 1.682 trillion cubic feet at the end of last week, around 372 billion below the five-year average of 2.054 trillion cubic feet and 680 billion below last year’s total for the same period. Working gas in storage totaled 2.362 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 0.7% to $76.26, in a 52-week range of $73.90 to $89.30.
  • Chesapeake Energy Corp. (NYSE: CHK) traded up about 1.1% to $2.85, in a 52-week range of $2.53 to $6.59.
  • EOG Resources Inc. (NYSE: EOG) traded down about 0.3% to $101.14. The 52-week range is $81.99 to $119.00.

Also, the United States Natural Gas ETF (NYSEARCA: UNG) traded up about 0.8%, at $22.44 in a 52-week range of $20.40 to $31.72.