The U.S. Energy Information Administration (EIA) reported a withdrawal of 80 Bcf natural gas into storage for the week ended Nov. 18. The result came in slightly lighter than market expectations. Still, it was much steeper than the five-year average and supported already lofty Nymex natural gas futures.
“We are clearly well into the heating season now,” Refinitive analyst John Adeln said on the online energy platform Enelyst. His firm forecast this winter overall will be colder than the 30-year average. It “will be the third La Niña winter in a row, something that has not happened since 2000-01. La Niña winters typically feature cold weather in the Northwest,” which can spread throughout much of the Lower 48.
The weather during the latest EIA report period provided an early glimpse of such conditions.
“It was colder than normal over most of the U.S. besides the far East, while wind energy generation was lighter week/week,” NatGasWeather said.
The December futures contract was ahead 39.3 cents at $7.799/MMBtu prior to the noon ET inventory report – released a day earlier than normal because of the Thanksgiving holiday.
The prompt forged further higher to $7.832 when the EIA data crossed the wires. About 30 minutes later, it had leveled off some to $ 7.753, but it was still up 34.7 cents from the prior day.
Prior to the EIA report, major polls found expectations coalescing around a withdrawal in the mid-80s Bcf.
Estimates submitted to Reuters ranged from withdrawals of 65 Bcf to 111 Bcf, with a median decrease of 86 Bcf. Bloomberg’s poll also found a median withdrawal estimate of 86 Bcf. Predictions ran from pulls of 74 Bcf to 111 Bcf. The Wall Street Journal survey landed at an average pull of 89 Bcf. Estimates spanned decreases of 81 Bcf to 111 Bcf.
NGI predicted a pull of 65 Bcf.
The actual result compared with a decline of 14 Bcf in the year-earlier period and a five-year average decrease of 48 Bcf.
The 80 Bcf pull for last week lowered inventories to 3,564 Bcf. That compared with 3,626 Bcf a year earlier and the five-year average of 3,603 Bcf.
By region, the South Central decrease of 28 Bcf led the pack and included a 19 Bcf pull from nonsalt facilities and a 9 Bcf decrease in salts.
The Midwest and East followed with withdrawals of 21 Bcf and 16 Bcf, respectively, according to EIA. Pacific inventories declined by 9 Bcf, while Mountain region stocks fell by 5 Bcf.
Looking ahead, analysts expected another bullish print relative to historic norms.
Early estimates for the week ending Nov. 25 submitted to Reuters ranged from withdrawals of 79 Bcf to 119 Bcf, with an average decrease of 103 Bcf.
The estimates compare with a decrease of 54 Bcf during the similar week of 2021 and a five-year average decrease of 34 Bcf.