12 February 2010 17:52 [Source: ICIS news]
HOUSTON (ICIS news)--Deliveries from US natural gas underground storage totalled 191bn cubic feet (bcf) last week, the US Energy Information Administration (EIA) reported on Friday, bolstering futures prices.
Aggregate storage levels sat at 2,215 bcf in the week ended 5 February, down from 2,406 bcf in the previous week. The most recent storage total was 8.4% above the mark in the same week last year and 5.4% over the five-year average.
The usual take from storage was larger than the typical pull of around 145 bcf in the first week of February. But the draw last week was within analysts' projections between 160 bcf and 210 bcf.
Futures on the NYMEX jumped shortly after the EIA release. March contracts were trading higher by 8.8 cents at $5.484/MMBtu as of 11:49 New York time (16:49 GMT). The second-month benchmark was trading at $5.563/MMBtu, a gain of 8.0 cents versus Thursday.
Bullish sentiment was also coming from the second hefty snowfall set to dump down on the massive heating region of the US northeast.
Demand from the power grid rose 3.3% to a three-week high during the EIA reporting week, according to energy analyst Stephen Schork.
But the EIA timestep did not include the impact felt from snow squalls that put several feet of snow in the midwest and northeast, foreshadowing large draws in the coming weeks.
"Space-heating needs are presently surging," Schork wrote in his newsletter The Schork Report. "Therefore, odds are short we will see a few more triple-digit deliveries before we finally exit this winter."
Today's NYMEX futures prices were slightly above EIA's projected average price for 2010 at $5.37/MMBtu.
The more-than-anticipated depletion of natural gas storage provided upward support for the 2010 average futures price, which is $1.42 higher than the 2009 average of $3.95/MMBtu, according to the EIA.
US natural gas prices are an important barometer for chemical producers who use natural gas as a feedstock and a power fuel.
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