Natural gas prices rose at most major regional trading locations this week, particularly in the Northeast. Prices in New York and New England, which fell back to single-digit dollar levels at the end of last report week due to the end of a cold snap, rose back into the double-digits upon the arrival of more cold weather.
The Henry Hub price rose by 17 cents per million British thermal units (MMBtu) this week to $3.41 per MMBtu, after having dropped last week by 29 cents per MMBtu.
The March 13 Natural Gas contract started this week at 3.31 and made its way up above $3.45 on Wednesday -- 2/6 -- before diving to the downside on Thursday. Fresh support lies at $3.27.
Currently, March 13 Nattie at $3.32 and threatening upward motion at mid-morning.
Residential/Commercial and power demand increased, while supply levels remained relatively flat. Largely due to high heating demand resulting from this week’s cold weather, average daily residential and commercial consumption rose by 9.8 percent or 4.4 Bcf/d compared to last week, according to estimates from Bentek.
Consumption of natural gas for electric power also rose, by 7.5 percent or 1.4 Bcf/d, while industrial consumption increased by 1.6 percent or 0.3 Bcf/d. This rise in demand occurred alongside a slight decrease in supply.
Production decreased by 0.2 percent below last week’s levels, and Canadian imports decreased by 1.4 percent. LNG sendout remained at historically low levels.
Working natural gas in storage decreased to 2,684 Bcf as of Friday, February 1, according to EIA's WNGSR. This represents an implied net withdrawal of 118 Bcf from the previous week. This week's net withdrawal was 47 Bcf less than the 5-year average net withdrawal of 165 Bcf, and 24 Bcf larger than last year's average net withdrawal of 94 Bcf. Inventories are currently 226 Bcf (7.8 percent) less than last year at this time and 351 Bcf (15.0 percent) greater than the 5-year average of 2,333 Bcf.
All three storage regions posted declines this week. Inventories in the East, West, and Producing regions decreased by 88 Bcf (the 5-year average net withdrawal is 104 Bcf), 10 Bcf (the 5-year average net withdrawal is 20 Bcf), and 20 Bcf (the 5-year average net withdrawal is 41 Bcf), respectively. In the Producing region, working natural gas inventories decreased 4 Bcf (1.6 percent) in salt cavern facilities and decreased 16 Bcf (2.1 percent) in nonsalt cavern facilities.