Why the EIA Storage Report Moves Markets
- Timothy Beggans
- Jan 1
- 2 min read
The weekly EIA Natural Gas Storage Report is one of the most market-moving data releases in U.S. energy. For traders, it is not just about how many BCF were injected or withdrawn—it’s about flexibility, location, and future risk.
The U.S. relies on three types of natural gas storage, each with different implications for price volatility:
Salt Dome Storage
Primarily located along the Gulf Coast, salt caverns offer extremely high deliverability and rapid injection and withdrawal. These facilities can cycle gas multiple times per year and are sold based on the number of “turns.” Their speed makes them critical for responding to weather shocks, LNG feed-gas variability, and pipeline constraints.
Depleted Field Storage
The most common storage type nationwide. Depleted reservoirs provide large capacity but lower flexibility. Injections and withdrawals occur in a gradual, “stair-step” pattern over months, making them better suited for seasonal balancing than short-term volatility.
Aquifer Storage
Less common and geologically complex, aquifers behave similarly to depleted fields but often require higher base gas and tighter pressure management.
Why does this matter for trading?
During winter, demand surges in the Northeast and Upper Midwest often exceed local deliverability. The system depends on Gulf Coast salt storage to balance pipelines during periods of stress. This geographic mismatch is a key driver of basis risk and futures volatility.
That dynamic was evident in January 2025, when cold weather tightened balances and injected risk premium into the curve. Earlier in the year, concerns over winter supply helped lift the April–October strip, showing how storage expectations can move forward prices well before peak demand arrives.
Looking ahead, LNG exports, data centers, and industrial growth are steadily increasing baseload demand. Storage capacity—especially high-cyclability salt—is increasingly contracted long-term, and the system is beginning to strain. As a result, new storage expansion plans are gaining attention.
Bottom line: the EIA Storage Report is a weekly window into system flexibility—and a powerful catalyst for price discovery.
Links:
EIA Natural Gas Storage: https://www.eia.gov/naturalgas/storage/
EIA Weekly Natural Gas Report: https://www.eia.gov/naturalgas/weekly/
U.S. LNG Overview: https://www.eia.gov/energyexplained/liquefied-natural-gas/
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