Next storage reportI'm seeing the next EIA storage report near 160's draw down.
This should put the deficit to the five year average near -800 B cu ft.
This has not been seen since 2002 and that was when there was less demand for ng to heat and make electricity.
That is a really steep reversal on the storage chart and if the weather doesn't break to warmer for December, then this storage chart cannot even go flat for a while. There are increasing demands as some more than normal nuclear capacity outage currently used an extra 6.6 B Cu ft over the current week than was expected.
Coal has been reducing since 2002 and nuclear has not added capacity, only NG has added capacity and it is gobbling up (pun) the increased production.
The nuclear outages all summer were more than normal averaging in the 24GigaWatts missing and that lead to less storage too.
The utilities were reluctant to buy and store futures because spot prices were so low all summer and they are now going to have to pay more than they would have, if they had done more storing. They were trying to save a buck on storage costs and unrecoverable injection losses.
They will now have to battle for NG during the winter. This situation will be bullish for NG Jan contract. The expiring Dec could drive up really hard in the final week of trade.
The upside will be limited though as the production is trying to add a bearish balance.