US EIA data showed a US natural gas storage change of 36B for 27 March. This was below the expected 38B.
The release indicates storage rose by 36B versus a forecast of 38B. The difference from expectations was 2B.
Market Context Then And Now
Looking back to this time in 2025, we saw a weekly storage injection of 36 billion cubic feet, which was just under the 38 Bcf expectation. This signaled a relatively tight supply-demand balance as we ended that withdrawal season. The market at that point was sensitive to any signs of higher-than-expected demand.
Our current situation in early April 2026 is markedly different, creating a much softer backdrop. We are entering the injection season with storage levels around 2,150 Bcf, which is more than 20% above the five-year average for this time of year. Furthermore, robust domestic production continues to hover near record highs of 105 Bcf/day, keeping supply plentiful.
Weather forecasts are also pointing towards bearish pressure, with milder-than-normal temperatures expected across much of the country for the next several weeks. While demand for LNG exports remains very strong, averaging a record 14.5 Bcf/day, this steady pull may not be enough to counter the weak domestic demand. This setup suggests a cap on any significant near-term price rallies.
Options Trade Implications
For derivative traders, this environment suggests that selling out-of-the-money call options on the May and June 2026 contracts could be a prudent strategy. This approach allows us to collect premium while betting that the combination of high storage and mild weather will prevent a significant price spike. It offers a way to capitalize on range-bound or downward price action with defined risk.
