The highest peak of natural gas demand occurs during the heating season from November to March. Then on the 1st of April each year, storage facilities switch from net withdrawals to net injections.
Due to the latest nor’easter in March that moved through the American Northeast and Atlantic Canada, US storage withdrawals continue to be weak.
This year’s storage ending balance is expected to be at 1.3 trillion cubic feet (tcf) compared to the five-year average end of season balance of 1.71 tcf.
In Ontario, the natural gas storage level at Ontario’s Dawn Hub is also near its lows for this time of year. Meanwhile out west, AECO storage levels in Alberta remain near record highs, a sign of continuing export challenges.
The outcome is that record high production levels are expected to keep a lid on prices. On the flip side, expectations of significantly diminished end-of-withdrawal-season stocks are feeding bullish sentiment.
