The EIA reported a +79 Bcf injection for the week ending November 4th, which came in very close to the market expectations of ~+81 and our estimate of +78. Both are S/D model and flow model showed a similar injection level, and therefore we were happy to see the number fall within the tight range of our expectations. This storage report takes the total level to 3580 Bcf, which is 37 Bcf less than last year at this time and 76 Bcf below the five-year average of 3,656 Bcf.

This report continues the string of loose storage numbers to close the summer out. We calculate this report to be 3.4 Bcf/d looser than LY on a wx adjusted basis.

Our fundamental storage model performed well the storage week, with the actual storage report coming in only 2 Bcf lower than our estimate. Here are the details we gather from the fundamentals:

  1. Total supply was lower for the reporting period with lower Canadian supply being the culprit. Imports from Western Canada dropped on average by 0.4 Bcf/d with some maintenance work along key lines with the Alberta Nova system. Adding to the internal pipe issues in Alberta, the Midwest was not calling for gas (cash price spread did cover variable costs) due to the warm weather.
  2. National temps cooled week-on-week during the storage period. The cooling was expected due to the seasonal change, but overall temps finished the week much above normal for the majority of the country. At the national level, we saw HDDs increase by 1.4F which translated into +1.8 Bcf/d of RC demand. Here is a view of the temps by EIA region. 
  3. Power burns increased this week, with wind and solar generation pulling back. Below are the average MWh by generation type for the past 12 storage weeks
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  4. LNG volumes were higher by 0.6 Bcf/d with the return of Cove Point from 4-week annual maintenance. LNG volumes would have been higher, but 4-day pipeline maintenance on NGPL reduced feedgas levels to Sabine.

Today’s Fundamentals

Daily US natural gas production is estimated to be  100.4 Bcf/d this morning. Today’s estimated production is -0.39 Bcf/d to yesterday, and +0.28 Bcf/d to the 7D average.

Natural gas consumption is modelled to be 81.1 Bcf today,  +2.13 Bcf/d to yesterday, and +2.45 Bcf/d to the 7D average. US power burns are expected to be 28.4 Bcf today, and US ResComm usage is expected to be 21 Bcf. Starting this weekend majority of the US is going to cool relative to the 10Y normal. This is going to the quite the change relative to what we have been experiencing so far.

Net LNG deliveries are expected to be 12.1 Bcf today.

Mexican exports are expected to be 6.2 Bcf today, and net Canadian imports are expected to be 6.3 Bcf today.

The storage outlook for the upcoming report is +64 Bcf today.

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