Natural gas storage inventories increased 36 Bcf for the week ending July 19, according to the EIA’s weekly report. This is in line with the expected injection, which was 35 Bcf. Working gas storage inventories now sit at 2.569 Tcf, which is 300 Bcf above inventories from the same time last year and 151 Bcf below the five-year average. At the time of writing, the August 2019 contract was trading at $2.256/MMBtu, roughly $0.036 higher than yesterday’s close and ~$0.031 lower than last week’s. Production saw declines in the past couple of weeks out of the GoM due to Hurricane Barry, but this production has picked back up and is working toward a complete recovery. While GoM production has started to recover over the last week, weather forecasts turned cooler and power demand decreased by over 2 Bcf/d. The combination of adding more supply to the market and taking away demand volumes has sent prices down, hitting the August 2019 contract low during July yesterday at $2.220/MMBtu. Prices for the remainder of the summer will trade on changes to the weather forecast. Should the future outlook change to warmer temperatures, expect a slight price rally. However, should the forecasts show… continue reading
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Source: CTRM Center