Active Weather To Again Bring Only Modest Builds To Nat Gas Supplies
The coming storage report will bring another modest build to supplies, albeit bigger than last week. Active weather again brought numerous storms through the US with some very chilly Canadian air being tapped at times for the north-central US and deep into the Plains. This led to cooler than normal conditions over much of the central US with only the southwestern US and portions of the Northeast seeing near to warmer than normal conditions. The draw period (April 14-22nd) started with a fairly strong Spring storm spinning up over the central US. This led to a decent warm surge out ahead of it over the eastern US for mild conditions. However, on the backside of it cold air pushed deep into the central US with overnight lows dropping into the 20s and 30s for most areas. The slow moving storm finally tracked into the Midwest and eastern US Monday and Tuesday of the draw period and brought exciting weather as showers, thunderstorms, and snowfall affected many regions as well as a couple of below normal temperature days followed. Late in the build period, high pressure built into southern and eastern US for a nice warm up and easing of nat gas and heating demand. Because of the active weather and timely cool blasts into the central US and into the Ohio Valley region, the coming build will again be modest with only around +50-55 Bcf expected to be announced in the EIA weekly nat gas report. This is slightly higher than the 5 year average but we think the report could again come in on the light side as temperature data is not the only driver of demand and the stormy weather pattern will again assert a negative influence on builds. The coming report will clearly not be large enough to make a significant dent in the storage deficit numbers with supplies remaining around 1.0 Tcf below the 5 year average. Next weeks build will be a bit larger due to more pronounced warming, but the next few after that will again be factoring in some very active and chilly weather which will keep build numbers in check and lead to only around +50-55 Bcf gains. There is still nothing to suggest a hefty build will come anytime soon as chilly and active weather will continue into the second week of May. This should continue to support prices if any significant sell offs in price play out.
The draw period started with a weather system developing over the central US. This allowed chilly air to push deep into the Plains and even portions of the South. Mild conditions out ahead of the storm brought mild temperatures of 60s and 70s into the Northeast with 80s to the Southeast, killing demand. However, as the storm tracked east into Monday and Tuesday cool conditions covered much of the central and eastern US for a surge in heating demand.
Monday brought a variety of exciting weather with thunderstorms over the southern US and some snowfall behind the cold front and into the Great Lakes as a weather system tracked through.
Very active weather occurred Tuesday over the eastern US as a strong cold front pushed through with showers and thunderstorms ahead of it and cold and snow showers behind it.
After the front has moved through the eastern US, cool temperatures had covered much of the central and eastern US. This led to temperatures of 10-20F colder than normal over much of the US apart from portions of the southwestern US. Temperatures rebounded Thursday into Friday morning as high pressure began to build into the central and southeastern US.
The period closed with fairly quiet weather as a new warm surge was pushing into the southern and eastern US while a weak weather system was tracking across the Great Lakes. A weak weather system also led to mild shower over the Gulf states which helped keep conditions cool with shower and cloud cover.
Average temperatures for the week were very cold over the north-central US and into the Rockies as well as New England. This led to average (high and low) temps of only 20s and 30s for the northern Plains and upper Great Lakes. The southern US was mild, but still cooler than normal while the Southwest and into CA deserts were unseasonably hot.
The weekly temperature anomalies for the coming storage report show cooler than normal conditions over all of the central US with the Midwest experiencing temperatures more than 10F below normal. Milder conditions were observed over the Northeast as timely warm surges ahead of Spring storms allowed 3-8F degrees warmer than normal temps to set up. The western US, especially into Cal/Nev was exceptionally warm as temperatures were 10F warmer than normal.
