Natural Gas Inventory Growth Pressures Prices

Energy

Published: May 22, 2014 10:55 am

Last Updated: April 28, 2020 2:19 am

The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 106 billion cubic feet for the week ending May 16. That compared with an expected increase of around 100 billion to 103 billion cubic feet anticipated by analysts.

Natural gas futures prices traded up about 0.7% in advance of the EIA’s report, at around $4.45 per million BTUs, and slipped about 2.1% to around $4.38 immediately following the report.

This marks the second consecutive week of a larger-than-expected addition to inventories. But stockpiles are about 38% below their level a year ago and nearly 43% below the five-year average.

Pleasant temperatures are prevalent over the Midwest and Northeast this week but there will be cooler temperatures across the northern tier as some Canadian air moves across the country. The recent heat wave in the West is also expected to end soon, reducing demand for cooling.

The EIA reported that U.S. working stocks of natural gas totaled 1.27 trillion cubic feet, about 943 billion cubic feet below the five-year average of 2.21 trillion cubic feet. Working gas in storage totaled 2.04 trillion cubic feet for the same period a year ago. Natural gas inventories are rising again, but remain well below the bottom of the five-year range.

Here is how stocks of the largest U.S. natural gas producers reacting to the most recent report:

Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, was down about 0.3%, at $101.76 in a 52-week range of $84.79 to $103.45.

Chesapeake Energy Corp. (NYSE: CHK) was down about 0.7% to $27.98. The 52-week range is $19.32 to $30.48.

EOG Resources Inc. (NYSE: EOG) was down 0.2%, at $104.00 in a 52-week range of $62.27 to $106.50.

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