The U.S. Energy Information Administration (EIA) recently released a report indicating that natural gas supplies in the country have increased. According to the report, natural gas storage rose by 72 billion cubic feet for the week ending on June 30th. This surpasses the average storage increase of 65 billion cubic feet that analysts had expected, as shown in a survey conducted by S&P Global Commodity Insights.
However, this week’s EIA report had some interesting revisions. Due to the reclassification of certain natural gas supplies from base gas to working gas, the figures were adjusted. Working gas refers to the volume of gas available in the market. The reclassification resulted in an additional 4 billion cubic feet of working gas stocks in the nonsalt South central region. Therefore, the implied flow for the week shows an increase of 68 billion cubic feet to working gas stocks, according to the EIA.
In total, the latest report reveals that there is currently 2.877 trillion cubic feet of working gas in storage. This is an increase of 575 billion cubic feet compared to the same time last year and 366 billion cubic feet above the five-year average, as reported by the government.
As a result of this news, natural gas prices experienced a modest increase in Friday’s trading. In particular, August natural gas (NGQ23) traded at $2.65 per million British thermal units. This represents a rise of 4 cents or 1.3% on the New York Mercantile Exchange.
Overall, the growing natural gas supplies in the U.S. are likely to impact market dynamics and prices in the coming weeks.