A survey of analysts expects the US Energy Information Administration to announce a storage injection of 92 Bcf for last week, which is once again below the five-year average and will expand the storage deficit with even smaller injections projected for the next two weeks as cooling demand spikes.
Responses to the survey were tight and ranged from a build of 85 Bcf to 98 Bcf. The EIA plans to release its weekly storage report on Thursday morning for the week ended June 1. A 92 Bcf injection would be less than the 103 Bcf build in the corresponding week last year as well as the five-year average build of 104 Bcf. It would expand the massive storage deficit created by withdrawals extending deep into April.
FIVE-YEAR DEFICIT SET TO EXPAND TO 512 BCF
An injection within analysts' expectations of 92 Bcf would increase stocks to 1.817 Tcf. The deficit versus the five-year average would grow to 512 Bcf and the deficit versus last year in the corresponding week would expand to 799 Bcf. The EIA reported a 96 Bcf injection for the week ended May 25. It increased inventories to 1.725 Tcf, which was 31.4% less than the year-ago inventory of 2.513 Tcf and 22.5% less than the five-year average of 2.225 Tcf.
END-OF-SEASON FORECAST AT 3.4 TCF
Although some production growth in the Northeast, Southeast and Rockies regions gave a lift to the week's build, higher gas-fired power generation estimates and lower sample activity point towards a lower injection week over week, according to S&P Global Platts. The low level of injections throughout the month of May is adding downward pressure to the already very low 3.4 Tcf forecast for the end of injection season.
Population-weighted temperatures rose across all regions in the Lower 48, averaging 5 degrees warmer for the US overall. The warmer weather pushed up gas-fired power demand 2.8 Bcf/d this week, most significantly in the Northeast and Midwest.
The additional demand was offset somewhat by a 2.3 Bcf/d drop in residential and commercial heating demand. There was also a 0.2 Bcf/d bump in Canadian imports this week, but the effect on the final estimate was negated by an equivalent drop in industrial demand.
An early forecast for the week ending June 8 is calling for a build of 86 Bcf, according to S&P Global Platts Analytics, which is 5 Bcf less than the five-year average. The net injection is projected to fall below 80 Bcf for the week after.
