What Is the Natural Gas Storage Indicator?
Let me explain directly: the Natural Gas Storage Indicator is the U.S. Energy Information Administration's (EIA) estimate of working natural gas volumes held in underground storage facilities, covering both national and regional levels. I want you to know that the EIA delivers these weekly estimates for the Lower 48 states and five specific regions, focusing on changes from net withdrawals or injections. You should note that the report comes out every Thursday at 10:30 am EST, and if there are unexpected shifts like higher-than-average withdrawals or injections, they can immediately push natural gas prices up or down.
Understanding the Natural Gas Storage Indicator (EIA Report)
Here's what you need to grasp: this indicator measures working gas, which is the volume above a base level in a reservoir, ready for sale in the marketplace. In the EIA report, you'll see inventories for the current reporting week compared to the previous one, including the net change, broken down nationally and for the East, West, and Producing regions. It also gives you historical context with data from a year ago and the five-year average. I rely on this to point out that the data comes from weekly surveys of a sample of underground storage operators, which the EIA uses to build regional and national estimates.
History of the Indicator
You should know the background: weekly estimates of working gas in storage began with the American Gas Association (AGA) in 1994, but by 2001, they stopped the survey due to resource issues. That's when the EIA stepped in to keep the natural gas market informed, releasing their first estimates for the week ending May 3, 2002.
The Indicator Goal
According to the EIA, the goal here is straightforward: to provide weekly estimates of working gas levels in underground storage for the U.S. and five regions. Remember, the total natural gas in these reservoirs is divided into base gas or working gas, and the facilities could be depleted oil and gas fields, aquifers, or salt caverns. As a trader or anyone following the market, you'll find this indicator crucial because the natural gas market reacts right away to the net inventory changes from the prior week. This data helps inform your trading decisions, often shifting prices by 3 cents to 5 cents per million British thermal units (MMBtu) each week when the report drops.
Other articles for you
A sales lead is a potential customer or the data identifying them, generated through various marketing methods to eventually convert into clients.
A vertical merger combines companies at different supply chain stages to enhance efficiency, control, and synergies while potentially raising antitrust issues.
Economic life refers to the period an asset remains useful to its owner, distinct from its physical life, and is crucial for business planning, depreciation, and financial decisions.
The free look period allows new life insurance policyholders to cancel their policy without penalties and receive a full premium refund within a specified timeframe.
A perpetual inventory system continuously tracks inventory in real-time using computerized methods, contrasting with periodic systems that rely on physical counts.
The Gross Income Multiplier (GIM) is a basic metric for roughly valuing investment properties by dividing sale price by gross annual rental income.
Uncovered options are sold options without an offsetting position in the underlying asset, posing high risks with limited profits.
Up-front mortgage insurance is a premium paid on FHA loans to protect lenders from borrower defaults.
The Google tax is a diverted profits tax implemented by countries to prevent multinational companies from shifting profits to low-tax jurisdictions.
The employment-to-population ratio measures the proportion of the working-age population that is employed, offering a broad view of labor market health beyond just the unemployment rate.