Natural Gas Price Drops Below $3 Before Storage Report

Natural gas futures for February delivery traded down about 1.8% in advance of the EIA’s report, at around $3.05 per million BTUs, and slid to around $3.01 (down about 2.5% for the day) immediately following the report. Natural gas futures have slipped by about $0.15 per million BTUs since last week. Futures dropped to a 52-week low of $2.99 earlier Wednesday morning.

The cold weather expected for last week didn’t arrive until late in the week and will be reflected in next week’s storage report. From Wednesday through next week, however, slightly warmer weather is forecast to reach the heavily populated U.S. east coast before temperatures drop again mid-week.

Stockpiles are about 7.8% above their levels of a year ago and about 2.5% below the five-year average. The mild weather has curtailed stockpile drawdowns.

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The EIA reported that U.S. working stocks of natural gas totaled 3.22 trillion cubic feet, about 81 billion cubic feet below the five-year average of 3.3 trillion cubic feet and 232 billion cubic feet above last year’s total for the same period. Working gas in storage totaled 2.99 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 down about 0.6%, at $92.44 in a 52-week range of $86.19 to $104.76.

Chesapeake Energy Corp. (NYSE: CHK) was down about 0.8%, at $219.60 in a 52-week range of $16.41 to $29.92.

EOG Resources Inc. (NYSE: EOG) was unchanged at $92.70. The 52-week range is $80.63 to $118.89.

The United States Natural Gas ETF (NYSEMKT: UNG) was down about 2%, at $15.41 in a 52-week range of $15.22 to $27.89.

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