Natural gas futures - weekly outlook: March 16 - 20

Investing.com - U.S. natural gas futures edged lower on Friday, as market players continued to monitor extended weather forecasts to gauge the strength of demand for the fuel before the end of the winter heating season.

On the New York Mercantile Exchange, natural gas for delivery in April dipped 0.7 cents, or 0.26%, to settle at $2.727 per million British thermal units by close of trade.

Futures were likely to find support at $2.662 per million British thermal units, the low from March 11, and resistance at $2.864, the high from March 12.

For the week, Nymex natural gas prices slumped 4.8 cents, or 3.95%, amid speculation the end of the winter heating season will bring warmer temperatures throughout the U.S. and cut into demand for the fuel.

Prices are likely to remain vulnerable in the near-term as the coldest part of the winter has effectively passed and below-normal temperatures in March mean less than they do in January and February.

The heating season from November through March is the peak demand period for U.S. gas consumption. Approximately 49% of U.S. households use natural gas for heating, according to the Energy Department.

Natural gas futures plunged 9.0 cents, or 3.19%, on Thursday amid indications supplies are more than ample to meet demand.

The U.S. Energy Information Administration said that natural gas storage in the U.S. fell by 198 billion cubic feet last week to 1.512 trillion cubic feet, 46.9% above year-earlier levels and 13.0% below the five-year average for this time of year.

Last spring, supplies were 55% below the five-year average, indicating producers have made up for most of last winter’s unusually strong demand.

The Energy Information Administration's next storage report slated for release on March 19 is expected to show a withdrawal of approximately 51 billion cubic feet for the week ending March 13.

Supplies fell by 69 billion in the same week last year, while the five-year average change is a decline of 45 billion cubic feet.

Elsewhere on the Nymex, crude oil for April delivery settled at $44.84 a barrel by close of trade on Friday, down $4.76, or 9.61%, on the week.

Meanwhile, heating oil for April delivery dropped 8.35% on the week to settle at $1.713 per gallon by close of trade Friday.