The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks increased by 79 billion cubic feet for the week ending October 7. Analysts were expecting a storage addition of 79 billion to 95 billion cubic feet. The five-year average for the week is an injection of around 92 billion cubic feet, and last year’s storage addition for the week totaled 97 billion cubic feet. Natural gas inventories rose by 80 billion cubic feet in the week ending September 30.
Natural gas futures for November delivery traded down about 0.5% in advance of the EIA’s report, at around $3.17 per million BTUs, and traded near $3.28 after the data release. Natural gas closed at $3.21 per million BTUs on Wednesday, after posting a five-day high on Tuesday of $3.30. The 52-week range for natural gas is $2.17 to $3.30. One year ago the price for a million BTUs was around $2.93.
In its revised Short-Term Energy Outlook released Thursday morning, the EIA lowered its forecast for average dry natural gas production in 2016 from 74.06 billion cubic feet per day last month to 72.49 billion cubic feet per day. The 2015 average reached 74.14 billion cubic feet per day, a record.
The rising price for natural gas is due to reduced production and a forecast for a colder winter. Inventory levels remain near all-time highs, however.
Stockpiles remain about 1.5% above their levels of a year ago and 5.4% above the five-year average.
The EIA reported that U.S. working stocks of natural gas totaled about 3.759 trillion cubic feet, around 192 billion cubic feet above the five-year average of 3.567 trillion cubic feet and 56 billion cubic feet above last year’s total for the same period. Working gas in storage totaled 3.703 trillion cubic feet for the same period a year ago.
Here’s how share prices of the largest U.S. natural gas producers reacting to this latest report:
Exxon Mobil Corp. (NYSE: XOM), the country’s largest producer of natural gas, traded down about 1.5%, at $85.82 in a 52-week range of $71.55 to $95.55.
Chesapeake Energy Corp. (NYSE: CHK) traded down about 0.4% to $6.26. The stock’s 52-week range is $1.50 to $8.49.
EOG Resources Inc. (NYSE: EOG) traded down about 1.6% to $94.60. The 52-week range is $57.15 to $98.32.
Furthermore, the United States Natural Gas ETF (NYSEMKT: UNG) traded up about 3%, at $9.49 in a 52-week range of $5.78 to $11.36.
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