LNG - What Did the Latest Inventory Data Do to Natural Gas Prices? | Benzinga
The U.S. Energy Department's weekly inventory release showed that natural gas supplies decreased less than expected. The bearish inventory numbers notwithstanding, futures settled with a slight gain week over week on signs of production pullback.
Despite this spike, the market hasn't been kind to natural gas, with the commodity recently hitting nearly four-year lows due to worries about record output and concerns about a growing glut. At this time, we advise investors to focus on stocks like Coterra Energy (NYSE: CTRA) and Cheniere Energy (NYSE: LNG).
EIA Reports a Withdrawal Smaller Than Market Expectations
Stockpiles held in underground storage in the lower 48 states fell 37 billion cubic feet (Bcf) for the week ended Mar 29, below the guidance of a 39 Bcf withdrawal, per a survey conducted by S&P Global Commodity Insights. The decrease compared with the five-year (2019-2023) average net shrinkage of 1 Bcf and last year's decline of 29 Bcf for the reported week.
The latest draw puts total natural gas stocks at 2,259 Bcf, which is 422 Bcf (23%) above the 2023 level and 633 Bcf (38.9%) higher than the five-year average.
The total supply of natural gas averaged 105.6 Bcf per day, down 0.2 Bcf per day on a weekly basis due to a slump in dry production, partly offset by higher shipments from Canada.
Meanwhile, daily consumption fell to 105.2 Bcf from 114 Bcf in the previous week, mainly reflecting a sizeable drop in residential/commercial usage triggered by reduced space-heating demand in warmer weather.
Natural Gas Prices Still Finish Higher
Natural gas prices trended northward last week despite the lower-than-expected inventory decrease. Futures for May delivery ended Friday at $1.785 on the New York Mercantile Exchange, up some 1.3% from the previous week's closing. The increase in natural gas realization is the result of a pullback in supply. Nevertheless, the fuel has declined almost ...