The natural gas market in the US keeps on cooling down as natural gas prices (Henry Hub) keeps on falling and natural gas storage continues to bulk up.
The flooding along the Mississippi River raised concerns regarding transfer of natural gas via pipelines across the US; nonetheless, since the natural gas market is cooling down, these concerns affected very shortly the natural gas prices, and they have quickly fell during recent week.
Here’s a summary of the recent U.S natural gas market EIA report regarding the week ending on May 13th:
Natural gas Storage
The underground natural gas storage (Billion Cubic Feet) increased for the sixth straight week, last week by 5.0%; a 92 Bcf injection, – the highest injection since October 15th 2010; the natural gas storage rose to 1,919 billion cubic feet for all lower 48 states; the natural gas storage is still 1.8% below the 5-year average, and 10.9% below the storage level during the same week in 2010.
This storage increase was mainly because of the injection of 56 Bcf from the Eastern Consuming Region natural gas storage.
The chart below shows the natural gas storage (weekly figures) and Henry Hub natural gas prices during 2011; notice that natural gas prices rose up to last week and then tumbled down the following week.
U.S. natural gas consumption fell by 8% during the week, which is mainly due to fall in consumption in the residential and commercial sectors; this is probably due to the warmer weather.
Production and Imports
The U.S. natural gas production averaged 63.9 Bcf/d, below last week’s by 0.3%, but was 4.9% higher than the same week last year.
The imports of natural gas from Canada continued to decline, last week by 4.9% compared to last week with an average of 5.3 Bcf/d.
The US temperatures reached a weekly average of 63 degrees, which was warmer than last year by 5.9 degrees, and 2.9 degrees warmer than normal for the week ending on May 13th.
Prices for the week ending May 13th
Natural gas spot price (Henry Hub) declined during the week by 4.21% and reached by Friday 4.1$/mmbtu; its average daily change was -0.65%, and its weekly average was 7.24% below the previous week’s average price.
The Nymex Henry Hub Future Price (June delivery) on the other hand inclined by 2.31% during the week, but its average price was 6.31% below last week’s average price.
In total, natural gas storage rose, while prices, consumption, production and imports fell during the week of May 13th.
For further reading:
- Natural gas storage and prices keep on rising | May 13
- Natural gas storage rose for fourth week | EIA review, May 6
- Natural gas storage rose for third week | EIA review, April 29