EIA Natural Gas Storage Build Of +35 Bcf Misses Analyst Estimates

On August 29, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 35 Bcf from the previous week, compared to analyst consensus of +38 Bcf.  In the previous week, the working gas in storage has also grown by 35 Bcf.

At current levels, stocks are 228 Bcf higher than last year and 361 Bcf above the five-year average for this time of the year.

Natural gas prices continued to rebound from session lows as traders reacted to the EIA report. EIA natural gas storage build missed analyst estimates of +38 Bcf, which may provide some support to natural gas markets.

The current demand for natural gas is high. Weather forecasts indicate that demand should be high during the weekend. However, demand is expected to decline next week, which may put pressure on prices.

From a big picture point of view, oversupply remains a key problem for natural gas markets. The market needs significant positive catalysts to gain sustainable upside momentum.

Technically, natural gas settled above the nearest support at $2.00 – $2.05. This support has already been tested several times and proved its strength. 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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