Natural Gas in Underground Storage

The weekly EIA Natural Gas Storage Report advised that there was an injection of 63Bcf (billion cubic feet) into Underground Storage for the week ending October 19th, 2018.

This is 8Bcf above the median forecast of a 55Bcf injection, the average prediction of sector analysts and traders in the Dow Jones Newswires weekly survey. Storage is 606Bcf below last year for the same week and 624Bcf below the 5-year average. Working gas in storage stands at 3,095Bcf (C).

Natural Gas Pricing


As of 10:07AM CST, November 2018, (the prompt month) Natural Gas was trading at $3.22, -$0.02 from one week ago and the 1-Year Spread average was $2.92, -$0.03 from one week ago.

Crude Oil Pricing


As of 9:11AM CST, November, 2018, (the prompt month) Light, Sweet Crude on the NYMEX was at $67.28, -$1.80 from one week ago.

Crude Oil Inventory



US crude inventories increased by 6.3 million barrels to  422.8 million barrels for the week ended October 19th, according to data released yesterday morning by the US Department of Energy. Traders in the Reuters poll projected an increase of 3.7 million barrels.

U.S. Rotary Rigs


U.S. Rotary Rigs drilling for natural gas were +1 at 194 for the week of October 19th. The number of rigs currently drilling for Natural Gas was +17 from last year. US Rigs drilling for oil were +4 at 873. There are 137 more rigs targeting oil than last year. Canadian rigs were -4 at 191 for the week. Rigs targeting oil remain 82% of all US drilling activity.

Geopolitical


Message from Hurricanes Michael and Maria: Renewable energy makes more sense than ever: All eyes are now on the trail of destruction left by Hurricane Michael. This new devastation sadly comes only weeks after Hurricane Florence killed dozens of people and submerged vast swathes of countryside and left hundreds of thousands without power.

Climate change has created a terrifying new normal of severe weather patterns in many regions, and it seems we are now facing once-in-a-lifetime storms on a regular basis. To face this growing threat, we can no longer rely on old energy systems — we must develop infrastructure that can withstand increasingly frequent climate hazards. This gives us an opportunity to build in a smarter, more sustainable way.

Weather

The AccuWeather 1-5 day Outlook forecasts below-normal temps for the Eastern US  and Texas, excluding the deep Southeast  states. The Western US is forecast to be above-normal. The 6-10 Day Outlook shows continued below-normal temps in the Northeast, Illinois and surrounding states and a large portion of those states surrounding Ned Mexico. Almost all of the balance of the US are projected to be at normal temps.

11-15 Day Outlook  forecasts the Southeast and Northwest at above-normal temps with below-normal temps for New Mexico and parts of the surrounding states. The 30-day Outlook projects normal temps for almost all of the US.

The 90-Day Outlook shows normal temps for the entire country, with the exception of the Far-North Central States, which are expected to be above-normal.

Sustainability and Renewables


German Breakthrough in Harnessing Sunlight to Generate Hydrogen from Water: Solar-powered water splitting is a promising means of generating clean and storable energy, say German university researchers. In the light of global climate change, there is now an urgent need to develop efficient ways of obtaining and storing power from renewable energy sources.

The photocatalytic splitting of water into hydrogen fuel and oxygen provides a particularly attractive approach in this context, say the researchers based at Germany’s Wurzburg and Ludwig-Maximilians (LMU) Universities.

But there’s a problem. It turns out that efficient implementation of this process, which mimics biological photosynthesis, is technically very challenging, since it involves a combination of processes that can interfere with each other.

Now, LMU physicists led by Dr Jacek Stolarczyk and Professor Jochen Feldmann, in collaboration with chemists at Wuzburg led by Prof Frank Wurthner, have succeeded in demonstrating the complete splitting of water with the help of an all-in-one catalytic system for the first time.

This Week's Key Take-Away


Well, it depends on which weather service you want to believe. The National Weather Service predicts a warmer-than-normal month for November across the entire country, especially beginning in the second week. Intellicast.com shows exactly the same forecast. Accuweather shows normal temps for almost the entire nation but colder-than-normal in a small portion of the central states. Either way, it appears that this is a bearish prediction for natural gas and electricity prices over the next 30 days. Of course, that also depends on underground Natural Gas Storage and actual temps. The U.S. government puts the probability of El Niño developing by the end of the year at around 70-75 percent.

El Niño typically brings warmer temperatures into the northern United States but colder, wetter and stormier weather in the south.

Natural Gas production has continued at all-time highs but consumption has also remained high. There will probably be one or two more weeks of injection of Natural Gas into storage, prior to the winter out-flow beginning. At that point, Natural Gas will be at it's lowest level of storage since 2003. Stay tuned... this could get interesting.

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