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The US Energy Department said November 12 that working gas storage levels are in line with historic trends, but this comes before winter weather is set to trigger a surge in demand.
The US Energy Information Administration (EIA), part of the Energy Department, reported that gas storage levels were below the five-year range for much of the year.
“Storage levels approached average in late October and early November, the time of year when inventories are typically at their highest and when natural gas begins to be withdrawn as demand rises with colder weather,” it added.
EIA said it expected working natural gas in storage to be about 12% lower than the previous five-year average for this time of year.
“This forecast for inventories is very uncertain because it depends both on natural gas demand this winter, especially for space heating in the residential and commercial sectors, and on supply conditions as natural gas producers respond to higher natural gas prices,” EIA stated. “As we saw last February, cold weather can change this inventory level significantly.”
Winter Storm Uri in February brought freezing temperatures to parts of the US south, leading to widespread power outages and disruptions to regional oil and natural gas production.
Though natural gas prices in February were far below current levels of around $5.00/mn Btu, the benchmark Henry Hub climbed some 8% on the month.
There are current winter storm warnings for parts of the Northern Plains and the upper Great Lakes region and some parts of the country have already seen accumulating snow.
