EIA Natural Gas Storage Build Of +71 Bcf Exceeds Analyst Estimates

On June 21, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 71 Bcf from the previous week, compared to analyst consensus of +69 Bcf. In the previous week, the working gas in storage increased by 74 Bcf.

At current levels, stocks are 343 Bcf higher than last year and 561 Bcf above the five-year average for this time of the year.

Natural gas gained some ground after the release of the report, which has mostly met analyst expectations. Traders stay focused on the situation in the Gulf of Mexico and try to evaluate the impact of the tropical systems.

Increased natural gas production has recently served as a bearish catalyst for natural gas. Inventories stay at high levels, putting additional pressure on prices. Bulls hope that hot weather will provide sufficient support to natural gas prices. However, hot weather may have been already priced in by the market.

From the technical point of view, natural gas needs to settle back above the resistance at $2.80 – $2.85 to have a chance to gain sustainable upside momentum. A move above the $2.85 level will open the way to the test of the resistance at $3.02 – $3.09.

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