Regardless of its participation in…
Taqa, Abu Dhabi’s National Energy…
U.S. natural gas storage inventories decreased by 50 Bcf during the week ending Nov. 25, per EIA.
The 50 Bcf draw was relatively in line with market expectations of a draw in the low 50s and full range of forecasts expecting a draw between 26 and 65 Bcf. The withdrawal compares to a 35 Bcf reported last year.
The report is bullish as prices are up 11 cents this morning with about 3 cents of the gains happening after the storage report. Prompt month (Jan2017) is trading at $3.47 per MMBtu, at time of writing.
(Click to enlarge)
Storage inventories dropped below the 4 Tcf mark and stand at 3.995 Tcf, level only 0.6% above 2015 which is also the prior 5-year high, and 6.3% above the 5-Year average.
There is a bullish sentiment in the market that started about 3 weeks and that have been more pronounces since last week. The Jan17 contract is up 28% or 75 cents since the lows seen on Nov 9th.
Winter weather is finally materializing and although there will be a bearish storage report next week (smaller-than-average draw), the following two weeks will see significant higher draws than historical and will push inventories below last year and 5-year highs.
Drillinginfo continues to project price gains over the current forward curve with prices reaching levels north of $4.00+/MMBtu during winter months in 2017.
By Maria Sanchez via Drillinginfo.com
More Top Reads From Oilprice.com:
Since 1999, Drillinginfo has been a leading provider of oil and gas data and technology.