Natural Gas Price Steady on Storage Report, but Hot Weather Is Coming

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The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 66 billion cubic feet for the week ending June 22.

Analysts were expecting a storage injection of around 69 billion cubic feet. The five-year average for the week is an injection of 72 billion cubic feet and last year’s storage increase for the week totaled 48 billion cubic feet. Natural gas inventories rose by an upwardly revised 95 billion cubic feet in the week ending June 15.

Natural gas futures for July delivery traded up about 0.3% in advance of the EIA’s report, at around $3.01 per million BTUs, and slipped to $3.00 shortly after the report was released.

For the period between June 28 and July 4, NatGasWeather.com predicts “high” demand and offers the following demand outlook:

Hot high pressure will strengthen across the Midwest and East today into early next week with highs of 90s gaining ground. The southern US will be hot with 90s and 100s, while the West also hot other than the more comfortable Northwest and into California the next few days. With much of the country east of the Rockies becoming hot with 90s to 100s late this week into next, demand will be HIGH then VERY HIGH early next week.

Total U.S. stockpiles rose week over week to 26.2% below last year’s level and are now 19.5% below the five-year average.

The EIA reported that U.S. working stocks of natural gas totaled about 2.074 trillion cubic feet at the end of last week, around 501 billion cubic feet below the five-year average of 2.575 trillion cubic feet and 735 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 2.809 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 0.4% to $81.39, in a 52-week range of $72.16 to $89.30.
  • Chesapeake Energy Corp. (NYSE: CHK) traded also traded down about 0.4%, at $5.14 in a 52-week range of $2.53 to $5.44.
  • EOG Resources Inc. (NYSE: EOG) traded down about 0.5% to $123.29. The 52-week range is $81.99 to $128.03.

In addition, the United States Natural Gas ETF (NYSEARCA: UNG) traded up about 0.1% at $24.20 in a 52-week range of $24.15 to $27.92.