The NYMEX April natural futures contract settled Wednesday at $2.777/MMBtu, up 2.8 cents, as a demand uptick provided price support. The April contract has continued its upward trend, rising 13.8 cents, or 5.2%, since March expired as the front-month contract February 26.
February has experienced large storage withdrawals and storage stocks currently sit at an estimated 1.682 Tcf, an 18.1% deficit to the five-year average, according to the US Energy Information Administration.
But that could come to an end, as the last storage report of February approaches. A consensus of analysts S&P Global Platts surveyed expects a 59-Bcf withdrawal from storage for the week that ended March 2, well below the 129-Bcf five-year-average draw, EIA data showed.
In conjunction with low storage numbers putting pressure on prices could be some continued cold weather over the next week, as the most recent six- to 10-day outlook from the National Weather Service calling for colder-than-average weather across the West Coast, Northeast and Southeast.
Demand is expected to see a bump in the coming days as some cold weather may hit parts of the country. US demand is estimated to average 85.2 Bcf/d over the next seven days, a 2 Bcf/d increase from the 83.2 Bcf/d averaged over the previous seven days, according to S&P Global Platts Analytics.
Supply has remained relatively stable from the high levels experienced over February and March. Dry production is expected to average 77.4 Bcf/d over the next seven days, only a 400 MMcf/d drop from the 77.8 Bcf/d averaged over the previous seven days, according to Platts Analytics.
The NYMEX settlement is considered preliminary and subject to change until a final settlement price is posted at 7 pm EST (2400 GMT).
