The U.S. Energy Information Administration (EIA) reported on Thursday that natural gas storage inventories increased by 112 Bcf for the week ending May 22, 2015. The median estimate for the injection was 99 Bcf, indicating a miss of estimates by an astounding 13 Bcf.
Natural gas prices for July ’15 futures tumbled after the report’s release. Prices are likely to find support at $2.72 and $2.68 per mmBtu.
The EIA also reported that total stocks of natural gas (2,101 Bcf) were still higher than one year ago (1,364 Bcf) and remained below the five-year average (2,119 Bcf), although only slightly.
The larger-than-expected build comes on the heels of news from Bentek Energy that shows decline in natural gas demand as five nuclear power plants came back online over the first three days of the week.
Traders and investors are also processing the increasing likelihood of a cool summer, especially in the Midwest and Texas, where natural gas demand is expected to be lower than average due to less power generation needed for cooling.
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