US Storage at Four-Year Low

US gas storage facilities at end March held 1,351bn ft³, according to EIA’s Weekly Natural Gas Storage Report released April 12. This was 29% lower than the five-year (2013-17) average for the end of the heating season and the lowest since 2014, when working gas stocks ended the 2013–14 heating season at 837bn ft³. So the EIA is expecting a correspondingly high demand for injection this summer, but it also sees gas output up on last year.

The 2017–18 winter had periods of significantly colder-than-normal temperatures that resulted in relatively substantial natural gas storage withdrawals, including a record-breaking weekly withdrawal of 359bn ft³ in January 2018. Prices in the northeast were high enough to draw a Russian LNG cargo from Europe. Net withdrawals from storage during the 2017–18 heating season were 2,427bn ft³. This season had the second-highest net withdrawals recorded in a heating season, falling short of the 2,958bn ft³ net withdrawals reported for the 2013–14 heating season, which saw the 'polar vortex.'

The third-largest net withdrawals from storage were reported for the 2002–03 heating season, when working gas stocks ended the heating season at the lowest level on record at 730bn ft³.

Heading into the refill season, EIA expects injections into storage to exceed the five-year average. It forecasts that working gas levels will total 3,767bn ft³ at the close, requiring net injections of about 11.3bn ft³/day, about 3bn ft³/day more than last year but a little less than the 2014 refill season. EIA forecasts that dry gas production will average 81.6bn ft³/day during the 2018 refill season, up 8.3bn ft³/ day, or 11% more than last year’s rate which will help offset higher demand, exports, and refill season requirements.