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February 28, 2019, Natural Gas Storage Report: EOS Index Drops Below 1,000 Bcf

February 26, 2019  

The Weather

Last week, the number of heating degree-days (HDDs) went up by 4.8% w-o-w and by more than 40% y-o-y. We estimate that total energy demand (as measured in total degree-days – TDDs) was approximately 35% above last year’s level.

This week, the weather conditions have warmed up, but only slightly. A drop in heating demand was especially pronounced in the Southeast and Northeast parts of the country. We estimate that the number of nation-wide HDDs will drop by around 10.0% w-o-w in the week ending March 1. However, because HDDs are dropping from a relatively high base, the absolute consumption figures remain strong. Indeed, we estimate that total average daily demand for natural gas for the week ending March 1 should be somewhere between 115 and 120 bcf/d, which is as much as 20% above 5-year average for this time of the year. Total energy demand (measured in TDDs) should be no less than 40% above last year’s level.

Next week, the weather conditions are expected to cool down again and this time, quite significantly. The number of HDDs is currently projected to jump by whopping 30.0% w-o-w. In annual terms, heating demand is still expected to remain very strong (as much as 50% above last year’s level), while the deviation from the norm would rise to +55.0% (see the chart below).

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