The US Energy Information Administration today reported the US natural gas stocks fell by a total of 20 billion cubic feet, about 40%-50% more than the drawdown of 10-12 billion cubic feet that analysts had expected. Natural gas prices responded by rising about 2.5% at Henry Hub, to $3.51/thousand cubic feet.
The EIA reported that US working stocks of natural gas totaled 3.83 trillion cubic feet, about 300 billion cubic feet higher than the five-year average of 3.52 trillion cubic feet. Working gas in storage totaled 3.73 trillion cubic feet for the same period a year ago.
Natural gas producers did not realize a share price bump following today’s report. Exxon Mobil Corp. (NYSE: XOM), the largest gas producer in the US, is down about -1.3% and Chesapeake Energy Corp. (NYSE: CHK) is down nearly -3.7%.
The Henry Hub spot price for natural gas was $3.38/thousand cubic feet on December 5th, more than $1/thousand cubic feet lower than the $4.53/thousand cubic feet price on December 4th a year ago. The rapid development of shale gas production in the US is mainly responsible for the price compression.
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