Thursday, April 4, 2013

All Hail Jack Frost! EIA: Storage -94 Bcf to 1.687 Tcf

The EIA reported that working gas in storage was down 94 Bcf last week to 1.687 Tcf.  The weekly withdrawal was 137 Bcf greater/below than last year (an injection of 43 Bcf) and 98 Bcf greater/below the five year average (an injection of 4 Bcf).  The current level of working gas in storage is now 31.6% below last year (2.466 Tcf) and 2.1% BELOW the five year average (1.724 Tcf).

Yes, folks, below the five year average.  This is the first time the current storage level has been below the five year average since mid-September 2011.

And the picture we've all been waiting for:

The turnaround over the course of one year has been remarkable.  This week last year, the storage level was 60.5% above the then five year average.  Quite a reversal.

I urge you not to misread hubris into the above enthusiasm.  We should all recognize that it took a lot, repeat:  a lot, of pain to get to the point where the current storage level has fallen below the trailing average.  Lest we get too confident, remember:
  1. If the price of gas rises to a certain point and the storage pressure is lessened, gas producers will start to open the imaginary spigot and production will increase to offset these gains.  
  2. Let's not be too impressed and remember that the trailing five year numbers include several consecutive years of record high storage levels, including 2012's devastating numbers.  Comparisons are only as valid as the data against which you compare yourself.  
Temperatures last week averaged a chilly 41.3 degrees, which was 15.7 degrees cooler than last year and 6.0 degrees below average.  I don't think Jack Frost has too many more of these left in him this season...


Anonymous said...

Where's the graph? I've been anxiously waiting for the day that we pierced the five yr average and you dont display it on the graph? Does this not excite you enough to bother? I feel like I drove across the country to find a closed amusement park with a moose at the front door.

Robert Hutchinson said...

Ha! Working on it! I had to take my kid to an obligation this morning - darned spring break... Give me a few minutes - just got back to my computer. Believe me - I'm more excited than anyone!

Anonymous said...

I know...just teasing you! Thanks for all your hard work!

Robert Hutchinson said...

Believe me, I'm there too, right down to feeling like Clark Griswold at Walley World.

Anonymous said...

Record low today in Pittsburgh (19F), but starting today it going to get warmer and be in the 60s by next week. My guess is that next week's report will be the last withdrawal for the season.

The real question is will we have a repeat of last year's lower than normal injection season or a return of the 5 yr. average where the storage sloop is steeper.


Robert Hutchinson said...

Looking back over the past five years, the last withdrawal in 2008 was the first week of April. TC, that would line up with your thought (with which I agree). 2008 was the last pre-Haynesville/Marcellus gas year, so it's a good comparison. In 2009 and 2011, the last withdrawal was in the fourth week of March. In 2012 it was the second week of March. In 2010, it was the first week of March.

Going back to 2004-7, the average last withdrawal week was around the first week of April (but the average bottom storage level was 1.38 Tcf). If this week is the last withdrawal, 2013 would line up with historical averages in terms of timing, but the storage level bottoms out around 300 Bcf higher than the 2004-7 period.