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Natural gas extends losses on forecasts for mild autumn U.S. weather

Published 11/04/2013, 12:04 PM
Updated 11/04/2013, 12:05 PM
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Investing.com - Natural gas prices extended Friday's losses into Monday after weather reports continued to call for mild temperatures hovering over much of the eastern half of the U.S. through the first half of November.

On the New York Mercantile Exchange, natural gas futures for delivery in December traded at USD3.433 per million British thermal units during U.S. trading, down 2.29%.

The commodity hit a session low of USD3.408 and a high of USD3.468.

The December contract settled down 1.90% at USD3.513 per million British thermal units on Friday.

Futures were likely to find support at USD3.245 per million British thermal units, the low from Aug. 12, and resistance at USD3.869, the high from Oct. 16.

Updated weather forecasting models called for normal to above-normal temperatures for much of the eastern U.S. through mid-November, just as they did last week, which sent natural gas prices dropping on Monday.

Milder temperatures cut into the need for heating or air conditioning this time of year, lowering demand for natural gas at the nation's thermal power generators.

Inventory data released on Thursday also pressured prices lower.

The U.S. Energy Information Administration said on Thursday that natural gas storage in the U.S. rose by 38 billion cubic feet during the week before last.

Inventories rose by 66 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a build of 57 billion cubic feet.

Total U.S. natural gas storage stood at 3.779 trillion cubic feet as last week, 3.1% below last year's unusually high level but 1.6% above the five-year average for this time of year.

Early injection estimates for this week’s storage data range from 33 billion cubic feet to 45 billion cubic feet, compared to a 27 billion cubic feet increase during the same week a year earlier.

The five-year average for the week is a build of 36 billion cubic feet.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in December were down 0.06% and trading at USD94.55 a barrel, while heating oil for December delivery were down 0.41% and trading at USD2.8702 per gallon.









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