Investing.com – Natural gas futures were up sharply on Wednesday, climbing above the psychologically important USD4.00-level as mounting fears over a disruption to U.S. supplies in the Gulf of Mexico boosted prices.
On the New York Mercantile Exchange, natural gas futures for October delivery traded at USD4.014 per million British thermal units during U.S. morning trade, rallying 1.92%.
It earlier rose as much as 2.65% to trade at USD4.037 per million British thermal units, the highest price since September 2.
The U.S. National Hurricane Center said earlier that a storm system in Mexico’s Bay of Campeche has a 60% chance of strengthening into a tropical cyclone within the next 48 hours, compared to a 40% chance late Tuesday.
The NHS added that a tropical depression was forming in the Atlantic Ocean and was forecast to move west-northwestward within the next 24 hours, while an additional increase in wind speeds was also expected.
The U.S. Bureau of Ocean Energy Management said that nearly 41.6% of natural gas production in the Gulf of Mexico had been shut in as of Tuesday after Tropical Storm Lee passed through the region.
Energy traders track tropical storm activity in the event it disrupts production in the Gulf of Mexico, which is home to 10% of U.S. natural gas production.
Forecasts showing that warmer-than-normal weather was expected to return to most parts of the U.S. next week also provided support.
Industry weather group MDA Federal said in a report earlier that it expected above average temperatures in Texas and other southern states through the second week of September.
The weather forecaster added that the U.S. Pacific Northwest should continue to see “intense heat” over the next few days.
Natural gas traders monitor weather forecasts to determine whether temperatures may boost heating or cooling demand.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in October surged 2.95% to trade at USD88.56 a barrel, while heating oil for October delivery rose 1.26% to trade at USD3.061 per gallon.
On the New York Mercantile Exchange, natural gas futures for October delivery traded at USD4.014 per million British thermal units during U.S. morning trade, rallying 1.92%.
It earlier rose as much as 2.65% to trade at USD4.037 per million British thermal units, the highest price since September 2.
The U.S. National Hurricane Center said earlier that a storm system in Mexico’s Bay of Campeche has a 60% chance of strengthening into a tropical cyclone within the next 48 hours, compared to a 40% chance late Tuesday.
The NHS added that a tropical depression was forming in the Atlantic Ocean and was forecast to move west-northwestward within the next 24 hours, while an additional increase in wind speeds was also expected.
The U.S. Bureau of Ocean Energy Management said that nearly 41.6% of natural gas production in the Gulf of Mexico had been shut in as of Tuesday after Tropical Storm Lee passed through the region.
Energy traders track tropical storm activity in the event it disrupts production in the Gulf of Mexico, which is home to 10% of U.S. natural gas production.
Forecasts showing that warmer-than-normal weather was expected to return to most parts of the U.S. next week also provided support.
Industry weather group MDA Federal said in a report earlier that it expected above average temperatures in Texas and other southern states through the second week of September.
The weather forecaster added that the U.S. Pacific Northwest should continue to see “intense heat” over the next few days.
Natural gas traders monitor weather forecasts to determine whether temperatures may boost heating or cooling demand.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in October surged 2.95% to trade at USD88.56 a barrel, while heating oil for October delivery rose 1.26% to trade at USD3.061 per gallon.