From Natural Gas Intelligence:

September Natural Gas Steady Ahead of Potentially Lean EIA Storage Report

     8:55 AM    

September natural gas futures were set to open Thursday near even at around $2.939/MMBtu, with traders holding their fire ahead of the Energy Information Administration (EIA) storage report

Storage is Very Low for this time of year!! This is why the temperature forecast matters. 

Storage is just below the  bottom of the previous 5 year range and also almost 700 bcf below last year at this time!

EIA storage report from last Thursday:

+46 BCF! -Neutral

     From NGI:  EIA Reports Near-Target 46 Bcf Injection; September Natural Gas Trades Sideways                                                                                                                         

The 7 day period below covered the period on last week's report with +46 bcf injected. The next 7 day period ended, Friday 8-10-2018. The temperature maps below are for those 2 periods.

Last EIA period Temperature maps below(2 of them)

Maps for next report below. Note that it was WARMER, so the injection should be SMALLER:

Natural gas had a short term break out but has hit some tough resistance and some cooler forecasts(less bullish weather)ahead. Storage data last Thursday was neutral after being bullish the previous 3 weeks(expectations for big increases in  supplies coming soon are potentially bearish down the road....we will see).

Natural gas is threatening to have a MAJOR upside breakout(if heat is added to the forecast). However, much cooler weather will cause this to be a top:

Natural gas 3 months

Naturalgas 1 year below

Naturalgas 5 years below

Naturalgas10years below

Seasonals based on historical prices.

Being 700 bcf behind last year, NG storage will have to have an additional 100bcf a week on top of normal injections, just to catch up to last year.  

Unless it is an unseasonably warm winter, there is trouble ahead.  Record production doesn't mean anything if you are exporting more than you ever did too.  

                               EIA +33 bcf      a bit bearish?                                                                                                                                          

Buying opportunity.  it's 100bcf below what it will take to catch up to last year and get up to the 5 year average.  

Jim,

I agree but the market can focus on a couple of other things.

1. Short term.......Changes in the temperature forecast.

2. Longer term, there is a lot of supply coming to the market. This expectation is the main reason ng isn't way above $3, which one would think should be the case right now considering how low storage is headed towards Winter. 

 I agree with Mike. It was already down before the report due imo to a cooler mainly Euro ensemble. The GFS suites have been more volatile...so I consider them more neutral. Perhaps the 12Z runs will provide shed more light on which of the two suites has a better clue?

Sounds like the cattle mantra.  "There is all this supply coming online", but yet, the price keeps going up and cattle supply is slightly around historical averages.  

Historically, NG is strong this time of year.  Injections are not impressive at all.  A couple of bcf above predictions is bullish verses projections.  That we lost ground to last year is not.  We are WAY behind in all categories of storage.  Day to day there might be some downside due to weather, but to my way of thinking we are in a precarious position.

I don't see the storage numbers as that bad. The last 5 years at 3600-4000 max are way above the longer term average, and it would take a very abnormal winter to draw down from anything over 3000 to a problem zone.

Still, for the last 5 years Cheap Gas has led to a huge increase in consumption, so when production finally starts slowing....

Whenever that is.

It will turn precarious if we start Winter low and then get some record cold early on. 

At an absolute best, we are going to struggle to get much over 3000 BCF.  With so much electric being generated by gas and we are exporting more than ever, we are not in a good position.  

1. When considering CDDs in relation to the prior 4 weeks, today's EIA of +33 was clearly bearish though perhaps it was a bearish blip. We'll see in upcoming weeks. Also, vs. the DJ News industry survey mean (+29), it was the first bearish EIA in 2 months (last was for the week ending 6/15) as the prior 7 weeks were either bullish or neutral. In addition, the weather forecasts today looked a bit cooler than they had looked in relation to normals for the rest of the month. That combo made it quite hard to have an up day today. As it was, it closed nearly two cents off the lows. If it were to look warmer in the days to come or at least not any cooler, today's low of 2.891 would have a decent chance to hold considering the tight storage situation.

2. Compared to the last 2 years, I also have the +33 bearish based on the very hot 93 CDD week, the 2nd hottest of this summer to date. However, rather than bearish I have the +33 pretty neutral vs the last 15 years overall when considering the # of CDDs:

- bearish vs 2017, 16, 12, 07, 06

- neutral vs 2015, 13, 10, 09, 05

- bullish vs 2014, 11, 08, 04, 03

3. Now regarding 1998-2002, I have the +33 bullish vs all 5 of those years when considering the 93 CDDs.

(I don't have 1997-1994 CDD data to compare to. So, I can't analyze those 4 years.)

4. The 8/10/18 storage of 2,387 is the lowest for August 10 since way back in 2003! These years had lower storage on August 10 going back to 1994: 2003, 01, 00, 97, 96, and 95. 1999 was about the same.

 Anyone have a different take on the current storage situation?

Thanks tremendously for the magnificent insight/stats.

My ng storage records are at home(I'm in Detroit for 2 weeks taking care of my dad) but we can just go to the online EIA historical data to see......or we can rely on your stupendous statistics. 

I'm guessing from memory that todays prices below $3 are lower than many years before the age of fracking/horizonal drilling when storage for this date was higher. 

Lower.....for now.  (G)