The natural gas storage build surpasses expectations.

After the EIA report was published, natural gas prices have been experiencing a decline.

Key Insights

• Working gas in storage increased by 57 Bcf, surpassing the analyst consensus of +48 Bcf.
• The potential escalation of strike action in Australian LNG projects offered some market support, but prices have started declining following the release of the EIA report.
• The recent updates in weather forecasts indicating lower demand in upcoming days could further impact natural gas prices negatively.

On September 14, the EIA published its Weekly Natural Gas Storage Report, showing a larger-than-expected increase of 57 Bcf in working gas in storage compared to the projected 48 Bcf growth.

Currently, the natural gas stocks are 445 Bcf higher than last year at this time and 203 Bcf above the five-year average of 3002 Bcf.

Despite low current demand for natural gas and bearish weather forecast changes, there was some bullish sentiment as traders focused on the strike action at Chevron's LNG projects in Australia, which could impact global LNG markets.

However, the disappointing EIA report has put downward pressure on natural gas prices, which had already started falling after the report was released.

With stocks building faster than expected and projected low demand for the rest of the month, it remains uncertain if natural gas will find enough catalysts to break through the strong resistance in the $2.80 - $2.85 range.