Henry Hub Softens Despite Stock Draw

Henry Hub reversed its gains earlier on the day, despite a larger than expected draw in US stockpiles, as inventories continue to remain above the five-year average.

• US Natgas FEB 24 down -2.5% at 2.58$/mmbtu
• US Natgas JUL 24 down -2.4% at 2.61$/mmbtu
• Front month has reversed direction from a high of $2.883/MMBtu on the day. Lower LNG export feedgas, rising output and milder temperatures will add downside.
• The EIA weekly gas inventories for the week ending Jan 19 showed a draw of -326bcf compared to the expectation for a draw of -319bcf according to a Bloomberg survey and the seasonal normal draw of -149bcf.
• Despite the large draw the total US inventories of 2,856bcf remain above the previous five-year average of 2,730bcf.
• US domestic dry gas production continues to edge higher to 102.8bcf/d yesterday after the disruption due to cold weather last week.
• Feedgas supplies to US LNG export terminals fell back down to 13.1bcf/d yesterday after seeing a recovery up to 14.1bcf/d on Jan 23.
• Lower 48 natural gas demand is again lower today to 89.3bcf/d according to Bloomberg and the lowest since Dec 27.
• The US weather forecast shows above normal temperatures dominating across the US until the start of Feb.