The Platts pre-report analyst survey suggests US EIA data will show a build of 0 to 5 Bcf in natural gas stocks for the latest reporting week Washington, DC - April 1, 2009 The U.S. Energy Information Administration (EIA) on Thursday is expected to report an addition of between 0 and 5 billion cubic feet (Bcf) to natural gas storage inventories for the week that ended Friday, March 27, according to a Platts survey of analysts. An injection within expectations would compare with last year's 30-Bcf reduction in storage stocks and the five-year-average drawdown of 23 Bcf, according to EIA. As a result, the 372-Bcf year-over-year surplus and the 280-Bcf surplus over the five-year average are each expected to expand. A build above average or above expectations could push natural gas prices lower because it indicates that the market may be currently oversupplied with gas. Outside the consensus forecast, the full range of analyst expectations for the latest reporting period spanned from a withdrawal of 10 Bcf to an injection of 18 Bcf. Martin King, an analyst at FirstEnergy Capital, said a small injection would likely mean storage inventories will end the traditional winter heating season March 31 slightly above 1.6 trillion cubic feet (Tcf) -- considerably higher than average but short of the record of 1.692 Tcf set in March 2006. King said there are signs that the supply/demand balance is beginning to tighten, with the market now experiencing around 3 Bcf per day (/day) of excess supply vs. 7 Bcf/day a little more than a month ago. "We see this as more related to the power-generation sector favoring gas use over other fuels, especially at a time of maintenance in the power sector," he said. "Although the industrial sector undoubtedly remains weak, low natural gas prices are having some positive demand impacts in other sectors."
The U.S. Energy Information Administration (EIA) on Thursday is expected to report an addition of between 0 and 5 billion cubic feet (Bcf) to natural gas storage inventories for the week that ended Friday, March 27, according to a Platts survey of analysts.
An injection within expectations would compare with last year's 30-Bcf reduction in storage stocks and the five-year-average drawdown of 23 Bcf, according to EIA. As a result, the 372-Bcf year-over-year surplus and the 280-Bcf surplus over the five-year average are each expected to expand.
A build above average or above expectations could push natural gas prices lower because it indicates that the market may be currently oversupplied with gas.
Outside the consensus forecast, the full range of analyst expectations for the latest reporting period spanned from a withdrawal of 10 Bcf to an injection of 18 Bcf.
Martin King, an analyst at FirstEnergy Capital, said a small injection would likely mean storage inventories will end the traditional winter heating season March 31 slightly above 1.6 trillion cubic feet (Tcf) -- considerably higher than average but short of the record of 1.692 Tcf set in March 2006.
King said there are signs that the supply/demand balance is beginning to tighten, with the market now experiencing around 3 Bcf per day (/day) of excess supply vs. 7 Bcf/day a little more than a month ago.
"We see this as more related to the power-generation sector favoring gas use over other fuels, especially at a time of maintenance in the power sector," he said. "Although the industrial sector undoubtedly remains weak, low natural gas prices are having some positive demand impacts in other sectors."