US natgas futures up on lower-than-expected storage build

25 June 2009 17:24  [Source: ICIS news]

HOUSTON (ICIS news)--The build in US natural gas storage, at 94bn cubic feet (bcf) last week, was on the low end of expectations and brought futures prices into positive territory in Thursday trading.

Natural gas stocks were up by 4% in the week ended 19 June, according to an Energy Information Administration (EIA) report released early Thursday.

Natural gas demand jumped last week with an uptick in cooling demand that resulted from a heat wave in the US southwest.

Total underground inventories totalled 2,651 bcf during the reporting period, up from 2,557 bcf a week earlier.

Analysts had surmised increases between 92 and 105 bcf, according to Stephen Schork, editor of the energy and shipping newsletter The Schork Report.

Last week's injection at the lower end of estimates spurred NYMEX futures prices into the green, trading up by 4.6 cents at $3.807/MMBtu shortly after the EIA announcement.

Even with the narrower-than-expected build, natural gas inventories were still well above historical averages.

Last week's levels were 31.2% higher than last year at the same time, and 22.2% above the five-year average.

Natural gas is a major feedstock and power fuel for the US petrochemicals industry and downstream chemicals manufacturers.

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By: Ryan Hickman
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