EIA Report Reveals Unexpected Rise in Natural Gas Storage Levels Amid Market Fluctuations

On October 10, 2024, the U.S. Energy Information Administration (EIA) released its highly-anticipated Weekly Natural Gas Storage Report. The report detailed an increase in working gas storage of 82 billion cubic feet (Bcf) from the preceding week. This figure surpassed analyst expectations, which had projected an increase of 73 Bcf. The previous week had seen a more modest rise of 55 Bcf.

Current storage levels are significant, standing 124 Bcf higher than at the same time last year, and 176 Bcf above the five-year average. This data suggests a robust supply in the face of seasonal demand variations. These figures have had an immediate impact on market dynamics, with natural gas prices fluctuating as traders digest the implications of the report. The reported increase, which was higher than anticipated, is generally considered bearish for natural gas markets.

Meanwhile, natural gas markets are also closely monitoring the influence of Hurricane Milton on demand. Current reports indicate that over 3.2 million customers are without power in Florida, leading to a potential decline in natural gas demand. The critical question remains whether the effects of the hurricane have already been factored into market prices.

From a technical trading perspective, natural gas prices have shown support within the $2.60 – $2.65 range. Should prices fall below the $2.60 mark, analysts suggest they may continue their decline towards the next support level of $2.40 – $2.45.