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Natural gas drops as market looks past falling temperatures

Published 10/15/2013, 01:05 PM
Updated 10/15/2013, 01:06 PM
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Investing.com - Natural gas prices fell on Tuesday as investors locked in gains stemming from forecasts calling for below-normal temperatures across parts of the central and eastern U.S. and sold for profits.

On the New York Mercantile Exchange, natural gas futures for delivery in November traded at USD3.803 per million British thermal units during U.S. trading, down 0.46%.

The commodity hit a session low of USD3.786 and a high of USD3.855.

The November contract settled up 1.17% at USD3.820 per million British thermal units on Monday.

Futures were likely to find support at USD3.759 per million British thermal units, Monday's low, and resistance at USD3.982, the high from June 19.

Updated weather models continued to call for below-normal temperatures edging out seasonably mild temperatures across portions of the central and eastern U.S. in late October, which pushed up gas prices to levels ripe for profit taking, especially amid uncertainty as to how long the cold snap may last.

Demand for natural gas tends to rise at the country's thermal power plants as temperatures fall, as homes and businesses throttle up on their heaters.

Meanwhile, U.S. supply levels also remained in focus. Total U.S. natural gas storage stood at 3.577 trillion cubic feet as of last week, 3.7% below last year's unusually high level but 1.6% above the five-year average for this time of year.

The U.S. Energy Information Administration said last week that it will halt the release of its weekly natural gas inventory data due to the U.S. government shutdown.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in November were down 0.71% and trading at USD101.68 a barrel, while heating oil for November delivery were down 0.18% and trading at USD3.0261 per gallon.








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