The United States is entering the winter heating season with the highest natural gas in storage since 2020, the U.S. Energy Information Administration (EIA) said on Thursday.
The Lower 48 United States ended the natural gas injection season at 3,776 billion cubic feet (Bcf), according to estimates based on data from EIA's Weekly Natural Gas Storage Report.
The Lower 48 states are thus entering the winter heating season, which runs from November 1 through March 30, with the most natural gas in storage since 2020.
Moreover, the U.S. now has 5% more natural gas in inventories entering the winter heating season than the previous five-year average, and 7% more than last October 31.
The high natural gas inventories are partially the result of a milder 2022-2023 winter and weaker heating demand, which allowed working natural gas inventories to total 1,823 Bcf on April 1, 2023-the end of the previous heating season. This was 19% higher than the average U.S. April 1 total for the previous five years.
Due to the higher inventories at the end of the 2022-2023 winter, net additions to working U.S. natural gas inventories totaled 1,953 Bcf during the injection season through October 31. The net additions were 5% less than the five-year average and 9% less than in 2022, the EIA said.
High storage levels, rising natural gas production, and a milder start to this year's heating season are putting downward pressure on U.S. benchmark natural gas prices at Henry Hub. Prices have fallen from a high of $3.40 per million British thermal units (MMBtu) on November 13, to $2.55 per MMBtu on December 7.
U.S. natural gas demand is expected to be low in the coming week through December 13. Expectations are for light to very light national demand over the next 7 days, according to estimates from NatGasWeather.com.
By Charles Kennedy for Oilprice.com