Mild Weather Impacts U.S. Natural Gas Inventory
Last week saw a below-average withdrawal from U.S. natural gas inventories, as a mild first half of February limited heating demand and production recovered from January’s losses.
According to a Wall Street Journal survey of analysts, brokers, and traders, natural gas in underground storage is expected to have decreased by 66 billion cubic feet in the week ended Feb. 16, bringing the total to 2,469 Bcf. This anticipated withdrawal is smaller than the five-year average for this time of year, which stands at 168 Bcf.
Range of Estimates
Estimates from the survey range from a draw of 10 Bcf to one of 88 Bcf, showing a variety of perspectives on the situation.
Following a modest 49-Bcf draw the previous week, inventories currently sit 15.9% above the five-year average. This data indicates the current state of the market.
Price Movement and Industry Expectations
In response to these developments, natural gas for March delivery experienced a 13% increase on Wednesday, reaching $1.780 per million British thermal units. This rebound follows a recent low point in the market, with Chesapeake Energy announcing plans to reduce production due to prevailing conditions.
Keep an eye out for the U.S. Energy Information Administration’s weekly storage report, scheduled for release on Thursday at 10:30 a.m. EST.
For more insights, stay tuned for updates on the evolving natural gas landscape.