Natural gas in storage reaches record level

Fuel Fix ^ | November 6, 2015 | Robert Grattan

[thackney]

he U.S. has tied and is set to surpass a record for the amount of natural gas in storage, according to the latest Energy Department data.

Inventory figures released Thursday show 3.929 trillion cubic feet in storage across the country, tying the previous weekly record of 3.929 trillion cubic feet set on Nov. 2, 2012. And with two or three weeks of additional inventory gains expected this year, it’s likely the U.S. will have a new high mark by the time the summer and fall injection season ends.

The large amount of gas in storage, continued strong gas production and forecasts for a warm winter — which would mean less need for natural gas as a heating fuel — have weighed on prices. Natural gas fell close to $2 per million British thermal unit at the end of October, a three-year low.

Traditionally, U.S. inventories rise during the warm summer months and then fall as cold weather arrives and natural gas is used for heating. A colder-than-expected winter could lead to higher prices, but it would take a prolonged cold snap to burn through the extra cushion provided by the record amount of storage and force prices up significantly.

In total, the U.S. Energy Information Administration estimated that about 2.453 trillion cubic feet of natural gas has gone into storage since April, the second largest amount behind only the 2014 injection season. This winter, the EIA is forecasting the winter inventory draws will be less than the five-year average at about 2 trillion cubic feet.

That would leave about 1.9 trillion cubic feet of gas in storage when the weather warms in 2016, plenty to weigh prices down into next year as well. The EIA forecasts that natural gas prices will remain below $3 per million British thermal unit through mid-2016.

[thackney]

More info at:

Weekly Natural Gas Storage Report
http://ir.eia.gov/ngs/ngs.html

[rdl6989]

Good, it’s going to be a long winter.

[DannyTN]

Oh good. I thought it was just me.

[rdl6989]

You owe me a new keyboard lol.

[cicero2k]

My last gas bill (hot water, cooking only), for a month: $13.48.

So it’s basically free.

[Buckeye McFrog]

[crusty old prospector]

I still am amazed as very few gas wells are being drilled. No Haynesville, Barnett, Woodford, Cotton Valley, Rockies. It must all be casinghead gas from the Permian and Eagle Ford and from the elephant in the room - the Marcellus.