The natural gas prices sharply fell during the first week of October as the natural gas consumption for domestic use has sharply declined.
Here is a summary of the recent U.S natural gas market EIA report regarding the week ending on October 7th:
Natural Gas Storage
The underground natural gas storage (Billion Cubic Feet) inclined for the twenty-seventh straight week; last week by 3.3% or by 112 Bcf; the natural gas storage reached 3,521 billion cubic feet for all lower 48 states – the highest stock level since December 17th, 2010; the current natural gas storage is 2.0% above the 5-year average, but is still 1.6% below the storage level during the same week in 2010.
This increase in storage was primarily due to a 54 Bcf injection in the Eastern Consuming Region natural gas storage.
The graph below present the natural gas storage (weekly figures) and Henry Hub natural gas prices in 2011; the Henry Hub spot price continued the steep downward trend in recent months; during the first week of October the Henry Hub spot price sharply declined by 7.3% to an average weekly price of $3.53/mmbtu. The Henry Hub price was $0.01/mmbtu above its price level the same week in 2010.
US natural gas consumption largely fell during last week on a national level by 3.3% over the week; the residential and commercial sectors led the charge with sharp falls, while the power sector slightly inclined its NG consumption by 0.6%.
Production and Imports
The U.S. domestic supply slightly inclined during last week; the domestic; there was a very moderate increase in natural gas imports from Canada of 0.1% to an average of 5.6 Bcf/day; LNG imports remained nearly unchanged at an average of just a bit over 0.5 Billion cubic feet/day.
According to the report the natural gas rig count increased by 12 during the week to reach 935.
The US temperatures were nearly unchanged from last week, but cooler than normal: they have reached a weekly average of 67.7 degrees for the week of October 6th; they were 1.7 degree cooler than normal, but 0.3 degrees warmer than the temperatures from last year (same week).
Prices for the Week Ending October 7th
Nymex Henry Hub Future Price (November delivery) fell during recent week by 3.79% and reached on Friday $3.48/mmbtu; its weekly average price was 4.66% below the previous week’s average price.
Natural gas spot price (Henry Hub) also decreased by 4.76% during the week, and its average price was 7.40% below last week’s average price.
To sum up, natural gas storage, production and imports increased while natural gas prices and consumption fell during the week of October 7th.
For further reading:
- Natural Gas Storage Inclined by 97 Bcf Last Week – October 7
- Natural Gas Storage Rose by 111Bcf Last Week – September 30