EIA Reports 120 Bcf Natural Gas Build, Surpassing Forecasted Injection

Are Regional Storage Levels Supporting the Bearish Tilt?

Yes. All major regions posted gains, with the South Central region adding 39 Bcf—a significant contributor to the national increase. Notably, nonsalt storage in that region rose by 26 Bcf, reflecting weak power burn and strong production. The Midwest and East regions followed with builds of 32 Bcf and 36 Bcf, respectively, both signaling lackluster end-user demand. The Pacific and Mountain regions posted modest gains of 7 Bcf each, but even these areas remain comfortably above five-year norms, particularly in the Mountain region, which sits 40% higher than its five-year average.

What Does This Mean for Natural Gas Bulls Watching the Weather and LNG?

With cooler-than-average temperatures in key population centers limiting early cooling demand, and LNG feedgas flows plateauing, bulls have little near-term support. Unless sustained heat emerges or LNG offtake rises meaningfully, the storage trend is likely to outpace historical averages into June. This undermines price support near $2/MMBtu, where traders are already showing signs of hesitation.

Short-Term Outlook: Bearish Bias Persists as Storage Surplus Builds

This week’s stronger-than-expected injection adds to the broader theme of oversupply, with production holding steady and demand struggling to absorb it. Unless upcoming weather models shift sharply hotter or export volumes increase, the market is likely to remain under pressure. Traders should brace for continued downside risk, especially with injections consistently topping expectations and storage surpluses widening.