Natural gas storage inventories increased 84 Bcf for the week ending September 13, according to the EIA’s weekly report. This is higher than the market expectation, which was an injection of 81 Bcf. Working gas storage inventories now sit at 3.103 Tcf, which is 393 Bcf above inventories from the same time last year and 75 Bcf below the five-year average. Prior to the storage report release, the October 2019 contract was trading at $2.593/MMBtu, roughly $0.048 lower than yesterday’s close. At the time of writing, post report, the October 2019 contract was trading at $2.540/MMBtu. Last week, storage inventories topped 3 Tcf, and the end of injection season is in sight, with six weeks remaining until the change of season. October weather is currently expected to be above average in terms of temperature, creating a bearish sentiment in the market. Historically, October is when temperatures turn colder, increasing HDDs and Res/Com demand. However, above-average temperatures will cause fewer HDDs, creating less heating demand. This is also a time when CDDs fall off, as the season changes from summer to winter. Should forecasts hold true and October have above-average temperatures, a low-demand period will likely occur during October. Based on… continue reading
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Source: CTRM Center