US natural gas storage fields posted the first net withdrawal of the 2021-22 heating season, but injections continued in two of the five storage regions.
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Storage fields withdrew 21 Bcf for the week ended Nov. 19, according to data released by the US Energy Information Administration Nov. 24. The data was released one day earlier than usual to account for the Thanksgiving holiday. Although the week ended Nov. 5 is typically the final injection of the year, mild weather drove builds past that point in 2021.
The withdrawal was just below the 23 Bcf pull expected by a survey of analysts by S&P Global Platts. Responses to the survey ranged from a 12 to 30 Bcf withdrawal. The draw was less than the five-year average pull of 44 Bcf but more nearly double last year's 11 Bcf withdrawal in the corresponding week.
Working gas inventories decreased to 3.623 Tcf. US storage volumes now stand 320 Bcf, or 8%, less than the year-ago level of 3.943 Tcf and 58 Bcf, or 1.6%, less than the five-year average of 3.681 Tcf.
While the East, Midwest and Mountain regions all posted drawdowns, net injections occurred in the Pacific and South Central regions of the US.
This narrative quickly changes once we get to the week in progress, where the South Central appears to be firmly in withdrawal mode based on pipeline sample data, but even still there are some facilities in the South Central and even in the East region where nominal injections are taking place, if not daily then at least on a few days this week.
Industrial demand in the Southeast and Texas is on the path to fully recover from the impacts of Hurricane Ida in late August after lingering outages and maintenance works prolonged its rebound to prehurricane levels, according to Platts Analytics. November industrial demand is averaging 11.5 Bcf/d, up 800 MMcf/d from October and up 1.5 Bcf/d from September, which saw the height of hurricane-related impacts.
Platts Analytics' supply and demand model forecast a 62 Bcf withdrawal for the week ending Nov. 26, which is nearly double the size of the five-year average. Another above-normal draw is also expected for the week ending Dec. 3.
The NYMEX Henry Hub December contract added 10 cents to $5.06/MMBtu in trading following the release of the EIA's storage report. The remaining winter strip months, January through March, also crept higher. The strip has been revolving around the $5/MMBtu mark for the past two weeks.