Natural gas futures climb 3% on Northeast blizzard demand

Investing.com - U.S. natural gas prices rebounded on Tuesday, as snowfall in the heavily populated Northeast region boosted near-term demand expectations.

On the New York Mercantile Exchange, natural gas for delivery in March jumped 7.4 cents, or 2.62%, to trade at $2.923 per million British thermal units during U.S. morning hours, after hitting a daily high of $2.954.

A day earlier, natural gas lost 11.0 cents, or 3.72%, to settle at $2.848.

Futures were likely to find support at $2.762 per million British thermal units, the low from January 22, and resistance at $2.967, the high from January 23.

The National Weather Service said that parts of Connecticut, Maine, Massachusetts, New Hampshire, New York and Rhode Island have seen more than a foot of snow as of Tuesday morning.

The agency added that a blizzard warning remained in effect for parts of six states from eastern Long Island to southern and eastern New England. The blizzard warning for New York City was changed to a winter storm warning Tuesday morning.

Natural gas prices have been extremely volatile in recent sessions as investors react to daily changes in weather patterns. Futures have either gained or declined more than 5% in eight of the past 11 trading days.

Prices are down almost 35% since mid-November as an unusually mild start to winter limited demand while production soared.

Natural gas storage in the U.S. fell by 216 billion cubic feet last week, below expectations for a decline of 227 billion and compared to a drop of 236 billion in the preceding week.

Total U.S. natural gas storage stood at 2.637 trillion cubic feet, 8.2% above year-ago levels and 5.5% below the five-year average for this time of year.

Elsewhere on the Nymex, crude oil for delivery in March tacked on 32 cents, or 0.71%, to trade at $45.47 a barrel, while heating oil for March delivery inched down 0.51% to trade at $1.606 per gallon.