U.S. natural gas storage near to full, worries of further price deflation grow

U.S. energy companies have been stuffing extra gas into salt caverns, aquifers and depleted oil wells. By the time winter heating demand starts to empty these reservoirs, analysts predict they will be brimming with record amounts of the fuel, possibly growing so full that gas backs up into pipelines.
The prospect of not enough storage could further deflate U.S. gas prices that have recently traded at seven-year lows.
Storage in the gas-rich producing region that stretches from Alabama to New Mexico has hit a record 1,074 billion cubic feet more than two months before the traditional end of the gas injection season.
The region is home to the Henry Hub, the Louisiana delivery point for gas futures on the New York Mercantile Exchange, where gas for October delivery on Aug. 26 traded at $3.27 per million British thermal units.
Options traders have recently stepped up bets that prices will fall below $2 per mBtu by then, and spot gas could drop even further if producers have nowhere to store their output.