The U.S. Energy Information Administration (EIA) on Thursday is expected to report a 119-billion cubic feet (Bcf) withdrawal for the week that ended February 16, according to a survey of analysts by S&P Global Platts, the leading independent provider of information and benchmark prices for the commodities and energy markets.
Responses to the survey ranged for a withdrawal of 110 Bcf to 125 Bcf. The EIA plans to release its weekly storage report at 10:30 am EDT on Thursday.
A 119 Bcf draw would be more than the 92 Bcf withdrawal reported at this time in 2017 but less than the five-year average pull of 145 Bcf.
A withdrawal within analysts' expectations of 119 Bcf would deplete stocks to 1.765 trillion cubic feet (Tcf). The deficit versus the five-year average would shrink to 407 Bcf and the deficit versus last year in the corresponding week would expand to 604 Bcf.
The expected withdrawal is much weaker than the 194 Bcf draw reported by the EIA for the week ended February 9. It dropped inventories to 1.884 Tcf, which was 13.4% less than the year-ago inventory of 2.461 Tcf, and 18.7% less than the five-year average of 2.317 Tcf. Last week's draw of 75 Bcf in the Midwest region was a five-year maximum for the first week in February, accounting for a large part of the market's underestimation for the week.
Milder weather in the East Coast and Gulf Coast significantly dampened demand from the week prior.
“The EIA's South Central region warmed 7 degrees week over week, which corresponded to a drop in industrial and residential and commercial demand in the south by a combined 2.4 Bcf/d,” said Kent Berthoud, storage analyst with S&P Global Platts. “Although this was offset somewhat by lighter production, the South Central estimated draw decreased by almost half week over week.”
The week in progress looks to feature a much smaller draw as mild weather across the large markets across the eastern half of the US further doused demand. Platts Analytics' supply and demand model is forecasting a 42 Bcf draw for the week ending February 23 compared to the five-year average pull of 118 Bcf for the corresponding week.
Despite the high likelihood of back-to-back bearish withdrawals, NYMEX March natural gas futures climbed 4 cents to $2.656/MMBtu during noon trading on Wednesday.
The weekly analyst survey is conducted by S&P Global Platts' editorial team, and is published every Wednesday, one day ahead of the 10:30 a.m. (ET) Thursday release of the weekly natural gas storage report of the U.S. Energy Information Administration. Platts has been conducting this survey since January 2007. The survey includes 15 to 25 analysts, some on a rotational basis.
**In its weekly natural gas report, the EIA divides the U.S. into five storage regions: East, Midwest, South Central, Mountain and Pacific. The full listing of the states that comprise each can be found here.
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