Investing.com - U.S. natural gas prices rallied to the highest level in more than four months on Monday, as investors bet that chilly weather across the U.S. will boost early-winter demand for the heating fuel.
On the New York Mercantile Exchange, natural gas for delivery in December rose to a session high of $4.543 per million British thermal units, the most since June 26.
Prices last traded at $4.417 during U.S. morning hours, up 0.4 cents, or 0.38%.
Futures were likely to find support at $4.282 per million British thermal units, the low from November 7, and resistance at $4.606, the high from June 26.
Updated weather-forecasting models called for unusually cold temperatures across the eastern half of the U.S. from November 8 through November 17.
Bullish speculators are betting on the chilly weather to increase early-winter demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.
The heating season from November through March is the peak demand period for U.S. gas consumption.
Nymex natural gas prices surged nearly 18% since hitting an 11-month low of $3.620 on October 28 as expectations of colder-than-normal weather in the key heating markets in the U.S. boosted prices.
Meanwhile, investors continued to digest last week's inventory data, which showed that natural gas storage in the U.S. rose by 91 billion cubic feet, above expectations for an increase of 85 billion.
Inventories rose by 35 billion cubic feet in the same week a year earlier, while the five-year average change is a build of 42 billion cubic feet.
Injections of gas into storage have surpassed the five-year average for 29 consecutive weeks, alleviating concerns over tightening supplies.
Total U.S. natural gas storage stood at 3.571 trillion cubic feet as of last week, narrowing the deficit to the five-year average to 7% from a record 54.7% at the end of March.
Elsewhere on the Nymex, crude oil for delivery in December tacked on 71 cents, or 0.91%, to trade at $79.37 a barrel, while heating oil for December delivery rallied 1.52% to trade at $2.537 per gallon.