The Platts pre-report analyst survey suggests U.S. EIA data will show a 59- to 63-Bcf build to natural gas stocks for the latest reporting week

Washington - October 7, 2009

The U.S. Energy Information Administration (EIA) on Thursday is expected to report an addition of between 59 and 63 billion cubic feet (Bcf) to natural gas storage inventories for the week that ended October 2, according to a Platts survey of analysts.

An injection within expectations would bring storage levels to a new all-time high with four weeks remaining in the injection season. As of the week ended September 25, storage was at 3.589 trillion cubic feet (Tcf), and an injection on par with expectations would push overall levels to between 3.648 Tcf and 3.652 Tcf, setting another new all-time high record.

An injection in line with expectations, however, would be smaller than last year's 87-Bcf build and the five-year-average injection of 70 Bcf, according to EIA data. As a result, the 491-Bcf surplus over last year and the 481-Bcf surplus over the five-year average each should contract.

The wide range of analyst expectations spanned from a build of 46 Bcf to 73 Bcf. EIA estimated a 64-Bcf injection for the week ended September 25.

First Energy Capital analyst Martin King said last week was much cooler than the previous week, which means power demand fell, marking the end of the cooling season.

"Complicating matters is that there is currently a huge discount between cash and futures prices, promoting the incentive to buy and store and then sell forward. As such, although it was cooler and space heating needs are starting to emerge, we expect that storage injections were relatively on par with the previous few weeks."

King predicted that the market would see a 65-Bcf net injection Thursday. He noted that over the past two weeks the weather-adjusted gas balances show that the market has shifted from a 1.5-Bcf-per-day undersupply to an undersupply of 1 Bcf per day.

"The source of this shift is difficult to ascertain precisely, but there may be some hints that some shut-in production is being restarted and is trickling back into the market."

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This analyst survey is conducted by Platts’ editorial team in Washington DC and is published every Wednesday morning, one day ahead of the 10:30 am (EST) Thursday release of the weekly natural gas storage report of the US Energy Information Administration. Platts has been conducting this survey since January 2007. IMPORTANT NOTE TO EDITORS: The survey results attached above do not contain commentary from a Platts staff member. The survey is conducted and prepared by the Platts market news editors, but the views are those of non-Platts market analysts. The survey includes 15 to 25 analysts, some on a rotational basis. This differs from the weekly pre-report analyst survey of EIA/API US oil stocks data conducted each week by Platts Senior Oil Analyst Linda Rafield, which does include the views of Platts’ oil analyst Linda Rafield.