Allowing for normal weather variability in the remaining two months of winter, the storage projection on April 1, 2014 centers around 1.2 TCF, a very low level and about half a TCF below last year:
With at least one period of short and sharp cold weather coming right up, a second record storage withdrawal is in the offing. And with gas prices about $1.00 above last year, now in the $4.25 range, gas remains cheap enough to compete with Appalachian coal favorably, and hold much of it's market share in power generation.
But production continues to set records as well. Yet despite much higher gas prices, no significant rig response has yet materialized. It may require another quarter, or it may be that a $4 strip just isn't enticing enough. Or the third way: these prices are very profitable in the best basins, but infrastructure lags behind and no new wells could be turned to sales if they were drilled and completed. Either way, rigs are not moving to the marginal plays with takeaway capacity. NG rig counts through last Friday:
