US gas storage deficit vanishing amid mild summer weather

Thursday, August 01, 2013

With US natural gas storage inventories already at 2.845 Tcf with three months left in the refill season, estimates for season-ending levels may need to be revised upward if forecasts for milder weather come to pass, analysts said this week.

Summer came in like a lamb and may exit the same, but overall the weather has "just not been as hot as last year," noted analyst Martin King at FirstEnergy Capital.

As a result, gas storage injections have trended above the five-year norm except for a few weeks of anemic builds in July when a heat wave blanketed key consuming regions.

"We have moved past the climatological peak of summer, and the 14-day forecast does not indicate any significant heat for the US through the first half of August," said Logan Reese, analyst at Platts unit Bentek Energy. "We may still see a week or two of hot temperatures, but there is little to no chance for any sustained heat, and above-average temperatures in September cannot create significant demand like it can in July or August."

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