Natural Gas Price Gains Kept in Check by Soaring Production

The U.S. Energy Department’s weekly inventory release showed a smaller-than-expected increase in natural gas price and supplies and .

Stockpiles held in underground storage in the lower 48 states rose by 49 billion cubic feet (Bcf) for the week ended Aug 9.

below the guidance (of 54 Bcf gain). However, the increase was higher than last year’s increase of 35 Bcf for the reported week and is in line with the five-year (2014-2018) average net injection.

The latest rise in inventories puts total natural gas stocks at 2.738 trillion cubic feet (Tcf) – 357 Bcf (15%) above 2018 levels at this time but 111 Bcf (3.9%) under the five-year average.

Fundamentally speaking, the total supply of natural gas averaged 96 Bcf per day, unchanged on a weekly basis as dry production remained flat. Daily consumption also remained essentially flat at 86.6 Bcf with 86.8 Bcf in the previous week on static power generation demand.

Prices Edge Up

The natural gas futures market rose following the smaller-than-expected climb in U.S. supplies, with the commodity posting a 3.8% weekly gain and erasing some of the steep losses that have taken it to lows not seen since May 2016 earlier this month. Weather forecasting models predicting hot temperatures in certain regions of the Lower 48 U.S. states that would drive up the air conditioning demand for natural gas also helped lift prices higher

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