EIA Natural Gas Storage Build Of +10 Bcf Misses Analyst Expectations

On July 18, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 10 Bcf from the previous week, compared to analyst consensus of +28 Bcf.

At current levels, stocks are 250 Bcf higher than last year and 465 Bcf above the five-year average of 2,744 Bcf for this time of the year. High stocks have served as a major bearish catalyst for natural gas markets in recent weeks.

Natural gas prices gain ground as traders react to the encouraging report. Natural gas markets have been under pressure since early June as traders focused on high inventory levels and Freeport LNG outage.

Demand was strong due to hot weather, but it did not provide sufficient support to natural gas prices.

It remains to be seen whether current rebound would be sustainable as weather forecasts indicate that demand for natural gas would be moderate in the upcoming days.

From the technical point of view, natural gas prices received support in the $2.00 – $2.05 range as some traders were ready to bet that natural gas markets were oversold. In case natural gas manages to settle above the $2.10 level, it will head towards the nearest resistance, which is located in the $2.25 – $2.30 range.

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