Investing.com - U.S. natural gas futures declined for the third consecutive session on Friday to hit the lowest level in 32 months, as investors assessed the near-term demand outlook amid ample supplies.
On the New York Mercantile Exchange, natural gas for delivery in March retreated 2.1 cents, or 0.81%, on Friday to settle at $2.579 per million British thermal units by close of trade.
Earlier in the day, prices touched $2.567, a level not seen since June 21, 2012.
Futures were likely to find support at $2.539 per million British thermal units, the low from June 21, 2012, and resistance at $2.698, the high from February 5.
For the week, Nymex natural gas prices lost 8.5 cents, or 4.16%, capping the tenth weekly decline in the past 11 weeks.
Extended weather forecasting models showed that below-normal temperatures may give way to higher readings by the middle of February, dampening demand expectations for the heating fuel.
Bearish speculators are betting on the near-normal weather reducing winter demand for the heating fuel.
The heating season from November through March is the peak demand period for U.S. gas consumption.
On Thursday, natural gas lost 6.2 cents, or 2.33%, after a government report showed that U.S. natural gas supplies fell less than forecast last week, underlining concerns over weak demand.
The U.S. Energy Information Administration said in its weekly report that natural gas storage fell by 115 billion cubic feet, compared to expectations for a decline of 121 billion.
Inventories fell by a whopping 259 billion cubic feet in the same week a year earlier, while the five-year average change is a drop of 165 billion cubic feet.
Total U.S. natural gas storage stood at 2.428 trillion cubic feet, 24% above year-ago levels and just 1.2% below the five-year average for this time of year.
Natural gas prices are down almost 44% since mid-November as an unusually mild start to winter limited demand while production soared.
Elsewhere on the Nymex, crude oil for March delivery settled at $51.69 a barrel by close of trade on Friday, up $4.10, or 7.15%, on the week.
Meanwhile, heating oil for March delivery rallied 8.13% on the week to settle at $1.839 per gallon by close of trade Friday.