EIA Natural Gas Storage Build Of +59 Bcf Exceeds Estimates

On May 2, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 59 Bcf from the previous week.

Analysts expected that working gas in storage would increase by 55 Bcf, so the report exceeded analyst estimates.

At current levels, stocks are 436 Bcf higher than last year and 642 Bcf above the five-year average of 1,842 Bcf. High inventory levels serve as one of the key bearish catalysts for natural gas markets.

Natural gas prices are moving higher as traders react to the EIA report. The market is trying to stabilize near recent lows. Traders ignore high inventories and bet that the market has bottomed out.

It looks that traders are ready to bet that LNG exports would increase, boosting demand and supporting prices. In the near term, the market remains oversupplied. Demand for natural gas is mostly low, and bulls need positive changes in weather forecasts to build sustainable momentum.

At this point, the previously announced production cuts did not provide sufficient support to natural gas prices. From the technical point of view, a move above the $2.00 level will provide natural gas with a chance to gain additional upside momentum in the near term.

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