Natural gas prices tumbled on Thursday despite a smaller than expected build reported by the Department of Energy on Thursday.
Stronger future production forecast by the Energy Information Administration in their Short-term Energy outlook put downward pressure on prices.
The weather is expected to be normal over the next 2-weeks which will likely have a limited effect on the price of natural gas.
Currently, the prompt month NG contract is trading slightly higher at $2.347 up 2 cents.
Natural gas prices dropped sharply on Thursday, declining 2.6% and poised to test the June lows at 2.305.
A close below this level would put prices on a path to test the 2016 lows at 1.91.
Inventories Rose Less than Expected
Natural gas inventories rose less than expected according to a report from the EIA.
This represents a net increase of 102 Bcf from the previous week. Expectations were for inventories to rise by 114 Bcf.
Stocks were 189 Bcf higher than last year at this time and 230 Bcf below the five-year average of 2,318 Bcf. At 2,088 Bcf, total working gas is within the five-year historical range.
EIA forecasts that U.S. dry natural gas production will average 90.6 billion cubic feet per day (Bcf per day) in 2019, up 7.2 Bcf per day from 2018.
EIA expects natural gas production will continue to grow in 2020, albeit at a slower rate, averaging 91.8 Bcf per day next year.