The EIA reported a net gas storage withdrawal of 43 BCF this morning for the week ending March 24, 2017. This week’s report was below the market’s expectation which was centered around a 54 BCF withdrawal. It is bullish against 19 BCF withdrawn in this same week last year and against the five year average for this week which is a withdrawal of 27 BCF.
May 2017 NYMEX natural gas futures are currently $0.02/MMBtu lower at $3.21/MMBtu. The April contract expired on Wednesday at $3.175/MMBtu. Although gas futures managed to cobble together pricing support over the past couple of weeks after a late winter space heating demand surge, it will be a challenge to maintain pricing above $3.00/MMBtu as the market transitions into Spring. Next week’s report is expected to launch the start of the traditional storage injection season.
May 2017 NYMEX crude oil futures are currently $0.58 higher at $50.09/Bbl. The pricing balance is tipping towards the bulls this week after supply disruptions in Libya and optimism that OPEC and other major producers will extend production cuts for an additional six months or so after its next meeting at the end of May.
Natural gas inventories currently stand at 2,049 BCF which is 423 BCF less than from this same week last year and 250 BCF above the five year average.