Rapid US natural gas storage injections put pressure on prices

As what remains of the Henry Hub summer strip moves below $2.30/MMBtu, US natural gas prices at multiple hubs could stay subdued during the summer months. Regional dynamics mean underground storage sites are likely to continue to fill at an average or above-average pace – at least, until rising temperatures and exports draw down on the supply glut. Northeast rising Since the beginning of this year’s injection season in April, Northeast storage facilities have posted substantial weekly inventory builds, largely erasing running inventory deficits relative to historical averages. The trend has been aided both by strong regional production and weak seasonal demand, and comes in spite of dismal seasonal spreads – the differential that traditionally provides the price signal to inject now and withdraw later.     Both Dominion and Columbia Gas systems have seen storage inventories rise at a much faster clip than usual. In the case of Dominion, inventories have increased by a cumulative 102 Bcf so far this year, which is 23% greater than the five-year average cumulative build, and 46% greater than additions to storage over the same period in 2018, according to S&P Global Platts Analytics. Likewise on Columbia, storage inventories grew by 82 Bcf… continue reading

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