Natural Gas Report: Futures Threaten Psychological $5

January 23, 2014 09:12 AM

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  •  Inventories stand at 2,423 Billion cubic feet (Bcf) -- 19.8% below year-ago and 13.2% below the five-year average.
  • This week notes a 107 Bcf net withdraw from storage -- 61 Bcf smaller than the draw at the same time last year.
  • Canadian imports and a general increase in natgas production limited withdrawals from storage.


February '14 natural gas opened today at $4.699 and threatened the $5.00 mark at $4.94. The contract ended the day at $4.76. A violation of $4.98 would point bulls to $5.19 and $5.68 from mid-2010. Next support lies at $4.20 and $4.11 -- the top end of a 2 cent gap. Below that, bears will target $3.95 to signal a run to pivotal $3.91.index

The average temperature in the continental United States during the report week was 41.1°F -- 2.6°F warmer than the same time last year and 8.3°F above the 30-year average temp.

Prices --

The Henry Hub spot price rose 47 cents from $4.44 MMBtu to $4.91/MMbtu during the report week. Strong consumption amid frigid weather will limit downside action for natural gas prices in the coming week.

Consumption --

Total natural gas consumption for the report week rose 18.9% above last week's levels, as temperatures fell once again. Consumption in the residential/commercial sectors drove the increase, rising 27.8%, largely because of the sharp temperature drop Tuesday and yesterday. The industrial sector, which also uses some amount of natural gas for heating, consumed 3.9% more gas week-on-week, according to EIA.

Snowflake Photo credit: ChaoticMind75 / / CC BY-NC...

Indicated text by EIA.

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