The EIA reported a +32Bcf injection for the week ending July 15th, which came in much lower than the market consensus and our final estimate of +43. This number caught most of the market off guard, as most were expecting a low-40s build. So after a very loose number, the market flips to an extremely tight number that took bal summer and the winter strip much higher.
This storage report takes the total level to 2401 Bcf, which is 270 Bcf less than last year at this time and 328 Bcf below the five-year average of 2,729 Bcf.
Overall, we see this +32 Bcf injection being -0.4 Bcf/d tight vs the historical rolling 5-week period (wx adjusted). This tight number is even more remarkable given the Freeport outage. If this LNG facility was active then the end of season storage level would be extremely low.
Today’s Fundamentals
Daily US natural gas production is estimated to be 96.9 Bcf/d this morning. Today’s estimated production is +0.08 Bcf/d to yesterday, and -0.23 Bcf/d to the 7D average. Production hit a high of 98 Bcf/d last weekend, and we expect to get back to those level soon as the season CDDs start to fall off.
Natural gas consumption is modelled to be 83.9 Bcf today, -2.79 Bcf/d to yesterday, and +0.24 Bcf/d to the 7D average. US power burns are expected to be 45.6 Bcf today, and US ResComm usage is expected to be 9 Bcf.
Net LNG deliveries are expected to be 10.9 Bcf today. LNG deliveries will likely remain around 11 Bcf/d until the heat in the South pulls back.
Mexican exports are expected to be 7.3 Bcf today, and net Canadian imports are expected to be 6 Bcf today.
The storage outlook for the upcoming report is +15 Bcf today.
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NatGas-Daily-Report-July-22-2022.pdf