The U.S. Energy Information Administration reported a net 2-Bcf injection into natural gas inventories in the Lower 48 during the week ended Dec. 1 that defied market expectations and historical averages.
The market consensus ahead of the report's release called for a 7-Bcf drawdown from stocks, against respective year-ago and five-year average withdrawals of 43 Bcf and 69 Bcf.
The build brought total U.S. working gas supply to 3,695 Bcf, or 264 Bcf below the year-ago level and 36 Bcf below the five-year average storage level of 3,731 Bcf.
January 2018 natural gas futures were sharply lower ahead of the report's release. The contract was 13.7 cents lower on the session at $2.785/MMBtu at 10:29 a.m. ET. The contract stalled immediately following the data's release and then extended the downside to a $2.766/MMBtu low while moving last 14.5 cents lower on the session at $2.777/MMBtu.
In the East, inventories were down 8 Bcf on the week at 868 Bcf, or 3.7% below the year-ago level. Storage levels in the Midwest were down 10 Bcf at 1,058 Bcf, or 5.1% below the year-ago level. In the Mountain region, storage levels were flat on the week at 221 Bcf, or 13.7% below the year-ago level, while in the Pacific region, storage levels were down 1 Bcf at 313 Bcf, or 3.4% below the year-ago level. In the South Central region, where storage levels were up a net 21 Bcf on the week, stocks are at a deficit of 9.5% to a year earlier.
Working gas stocks in the South Central region totaled 1,235 Bcf, with 360 Bcf in salt cavern facilities and with 875 Bcf in non-salt cavern facilities. Working gas stocks were up 12 Bcf in salt cavern facilities and up 9 Bcf in non-salt cavern facilities since the previous week.
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