Natural Gas Price Slumps After Inventory Report

Energy

Published: December 18, 2014 12:45 pm

Last Updated: April 28, 2020 2:22 am

The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stocks decreased by 64 billion cubic feet for the week ending December 12. That compared with an expected decrease of around 60 billion cubic feet anticipated by analysts.

Natural gas futures for January delivery traded up about 1.4% in advance of the EIA’s report, at around $3.82 per million BTUs, and slumped to below $3.70 (down about 0.5% for the day) immediately following the report. Natural gas futures have slipped by about $0.05 per million BTUs since last week.

Once again, moderate winter temperatures during the past week helped keep natural gas prices lower. In the coming days, a weather system will track through the Northeast with areas of rain and snow. Wintry weather will continue to impact California and the Southwest, eventually arriving into Texas late in the week with increasing showers. Temperatures with these systems are not expected to drop enough to have much impact on demand for heating. However, a trend toward much colder weather systems will begin early next week.

Stockpiles are about 0.2% below their levels of a year ago and about 7.3% below the five-year average.

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The EIA reported that U.S. working stocks of natural gas totaled 3.3 trillion cubic feet, about 258 billion cubic feet below the five-year average of 3.55 trillion cubic feet and 6 billion cubic feet above last year’s total for the same period. Working gas in storage totaled 3.29 trillion cubic feet for the same period a year ago.

Here is how stocks 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, was up about 0.6%, at $89.522 in a 52-week range of $86.19 to $104.76.

Chesapeake Energy Corp. (NYSE: CHK) was up about 0.2%, at $18.71 in a 52-week range of $16.41 to $29.92.

EOG Resources Inc. (NYSE: EOG) was down about 0.7% to $90.68. The 52-week range is $80.59 to $118.89.

Also, the United States Natural Gas ETF (NYSEMKT: UNG) was down about 0.2%, at $18.77 in a 52-week range of $18.27 to $27.89.

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