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Anticipated Rise in Natural Gas Inventories


The U.S. government’s natural-gas data, set to be released on Thursday, is anticipated to show an increase in inventories for the previous week. Despite steady LNG exports and average cooling demand for the summer season, the rise is expected to be slightly higher than usual.

According to a survey of 12 analysts, brokers, and traders conducted by The Wall Street Journal, gas in storage is forecasted to have risen by 47 billion cubic feet during the week that ended on July 14. Estimates range from 43 bcf to 51 bcf. In comparison, the injection during the same week last year was 35 bcf, while the five-year average rise stands at 45 bcf.

The Energy Information Administration (EIA) is scheduled to release its natural-gas storage data at 10:30 a.m. EDT on Thursday.

Should the increase amount to 47 bcf, total gas stockpiles would reach 2.977 trillion cubic feet. This marks a 24% increase compared to the previous year’s total and a 14% rise above the five-year average for this time of year.

Throughout most of 2022, natural-gas inventories remained below normal due to strong demand for heating and cooling. Furthermore, production facilities faced disruptions caused by storms and other events. However, natural-gas production has reached record-high levels since the beginning of 2023 and has remained steady. Demand, on the other hand, has struggled due to a mild winter and weak demand from the U.S. manufacturing sector, which heavily relies on natural gas.

LNG exports have also been slower this year. As a result, these factors have led to a surplus in natural-gas inventory and a substantial decline in futures market prices by 41% year to date, bringing it to around $2.626/mmBtu.

by Dan Molinski

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