Natural gas prices (Henry Hub) ended July very sharp falls, while the natural gas storage continues to stock up as it did last year.
Here is a summary of the recent U.S natural gas market EIA report regarding the week ending on July 29th:
Natural gas Storage
The underground natural gas storage (Billion Cubic Feet) inclined for the seventeenth straight week; last week by 1.6% or by 42 Bcf; as a result, the natural gas storage inclined to 2,758 billion cubic feet for all lower 48 states – the highest stock level since January 1st, 2011; the natural gas storage is still 2.4% below the 5-year average, and 6.3% below the storage level during the same week in 2010.
This rise in storage was primarily due to a 42 Bcf injection in the Eastern Consuming Region natural gas storage.
The chart below shows the natural gas storage (weekly figures) and Henry Hub natural gas prices during 2010 and 2011; the chart shows the steady stock up in natural gas storage; it also shows the sharp change in direction for natural gas spot price during last week. The Henry Hub is still $0.35/mmbtu below its price level the same week last year.
Consumption
The overall domestic natural gas consumption declined by 1.3% compared with previous week’s average consumption. The power sector led the drop with a 1.4% decline compared to the previous week.
Production and Imports
The U.S. weekly dry gas production reached 61 Bcf per day, which is an increase of 0.2% during the week; the dry gas production is still 6.5% above the production rate during the same week last year.
Natural gas imports from Canada changed direction and declined by 7.9% to an average of 6.7 Bcf per day during last week.
According to the report the natural gas rig count fell by 12 during the week to reach 877.
The US temperatures were warmer than normal and than last week for four consecutive weeks: they have reached a weekly average of 79.4 degrees for the week ending on July 28th, which were 1.1 degrees warmer than last year, and 4.0 degrees warmer than normal.
Prices for the week ending July 29th
Natural gas spot price (Henry Hub) decreased during the week by 4.27% and reached on Friday to $4.26/mmbtu; its weekly average price was 3.8% below the previous week’s average price.
The Nymex Henry Hub Future Price (August delivery) also declined by 5.61% during the week, and its average price was 4.1% below last week’s average price.
A detailed analysis of natural gas prices for the week of July 29th is herein.
To sum up, natural gas storage and production inclined while natural gas prices, imports and consumption fell during the week of July 29th.
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