Natural Gas Price Rebounds After EIA Report

Key Insights

• Working gas in storage grew by 18 Bcf from the previous week. 
• Analysts expected a build of 33 Bcf, so the EIA report missed analyst estimates by a wide margin. 
• Natural gas prices settled back above the $2.50 level as traders reacted to the report. 

On August 24, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 18 Bcf from the previous week, compared to analyst consensus of 33 Bcf.

At current levels. stocks are 513 Bcf higher than last year at this time and 268 Bcf above the five-year average of 2,815 Bcf.

In addition to the EIA report, traders will also focus on the developments in Australia. Accoring to recent reports, Woodside Energy reached an agreement with the unions at Australia’s LNG project. The news had a negative impact on the natural gas prices in Europe, which is dependent on LNG imports.

The U.S. market is not directly impacted by the developments in Australia, but a potential strike could have served as a positive catalyst for natural gas prices in the U.S. as consumers would have rushed to buy LNG everywhere they could find it.

Natural gas prices moved back above the $2.50 level after the release of the EIA report as natural gas storage build missed analyst estimates. The current demand for natural gas remains high, but it remains to be seen whether natural gas prices will be able to gain sustainable upside momentum as demand is expected to decline next week.

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