Natural Gas Storage Deficits, Favorable Prices Leave Market Looking for Production Growth

A worrisome natural gas storage deficit could narrow rapidly through the balance of March if forecasts for benign early spring weather prove accurate and production holds steady.

The U.S. Energy Information Administration (EIA) on Thursday posted a 9 Bcf storage injection for the week ended March 14. It increased inventories to 1,707 Bcf and put stocks 10% below the five-year average. That marked an improvement from 12% the prior week.

The deficit emerged after multiple arctic blasts that caused prolonged Lower 48 deep freezes in both January and February. The cold sent natural gas heating demand soaring, forced utilities to draw heavily on underground supply and ultimately boosted Henry Hub futures above the $4.00/MMBtu level.