Smallest U.S. Seasonal Gas Supply Drop on Record Seen on Warmthby
Natural gas stockpiles fall by 27 billion cubic feet in survey
Above-normal temperatures to persist in U.S. East: WSI
It’s officially winter in the Northern Hemisphere, and there’s still no sign of the frigid weather needed to shrink a record seasonal gas supply glut in the U.S.
Natural gas stockpiles probably fell by 27 billion cubic feet in the seven days ended Dec. 18 to 3.819 trillion, based on the median of 11 analyst estimates compiled by Bloomberg. That would be the smallest decline for the time of year in data going back to 1994. The survey predictions were for withdrawals ranging from 13 billion to 40 billion. The five-year average decrease for the period is 121 billion.
Gas prices are heading for the biggest annual drop since 2006 as unusually mild weather limits demand for the heating fuel. Production from shale formations is filling storage caverns across the U.S., expanding the inventory surplus to the five-year average.
“Santa may be delivering gifts in his red shorts this year,” Dominick Chirichella, senior partner at the Energy Management Institute in New York, said in a note to clients. “Demand will continue to be well below normal, resulting in ongoing underperformance of inventory withdrawals.”
Temperatures will probably be above normal in the Northeast and Midwest through Jan. 6, according to WSI Corp. New York’s high may be 65 degrees Fahrenheit (18 Celsius) on Dec. 25, 25 more than average, AccuWeather Inc. data show. About 49 percent of U.S. households use gas for heating.
Gas stockpiles totaled 3.846 trillion cubic feet as of Dec. 11, 9.1 percent above the five-year average and 16.4 percent higher than the year-ago level. The U.S. Energy Information Administration’s weekly inventory report is scheduled for release at 10:30 a.m. Thursday in Washington.