Investing.com - Natural gas futures were lower during U.S. morning trade on Monday, easing off a one-week high as market participants continued to monitor weather forecasts to gauge the strength of late-summer cooling demand.
Trade looked likely to remain thin, with markets in the U.S. closed for the Labor Day holiday.
On the New York Mercantile Exchange, natural gas futures for delivery in October traded at USD2.781 per million British thermal units during U.S. morning trade, shedding 0.65%.
It earlier fell by as much as 0.9% to trade at a session low of USD2.775 per million British thermal units.
Prices hit a one-week high of USD2.808 per million British thermal units on Friday, after updated weather forecasts predicted some late-summer heat returning to key parts of the U.S., raising the prospect of increased gas demand over the Labor Day weekend.
Industry weather group MDA EarthSat said temperatures in the Midwest and across the East Coast were expected to be well above normal over the next five days.
Above-average summer temperatures increase the need for gas-fired electricity to cool homes, boosting demand for natural gas.
But prices remained under pressure amid ongoing concerns over bloated U.S. inventory levels.
Total U.S. gas supplies stood at 3.374 trillion cubic feet, 14.6% above last year’s level and 12% above the five-year average level for the week.
Inventory didn't top the 3.3-trillion cubic feet level in 2011 until the end of September, with stocks peaking at a record 3.852 trillion cubic feet in November of last year.
Market analysts have warned that without strong demand through the rest of the summer cooling season, gas inventories will reach the limits of available capacity later this year.
The storage surplus to last year will have to be cut by at least another 150 billion cubic feet in the 13 weeks left before winter withdrawals begin to avoid breaching the government's 4.1 trillion cubic feet estimate of total capacity.
Early injection estimates for this week’s storage data range from 21 billion cubic feet to 57 billion cubic feet, compared to last year's build of 62 billion cubic feet. The five-year average change for the week is an increase of 60 billion cubic feet.
A bout of extreme heat across much of the U.S. over the past two months helped boost natural gas prices above the key USD3.00-level in recent weeks. Prices rallied to a 2012 high of USD3.275 per million British thermal units on July 31.
But futures have come under heavy selling pressure since the start of August, losing almost 14% after extended weather forecasts pointed to milder weather across most parts of the U.S.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in October eased up 0.05% to trade at USD96.52 a barrel, while heating oil for October delivery added 0.03% to trade at USD3.181 per gallon.
Trade looked likely to remain thin, with markets in the U.S. closed for the Labor Day holiday.
On the New York Mercantile Exchange, natural gas futures for delivery in October traded at USD2.781 per million British thermal units during U.S. morning trade, shedding 0.65%.
It earlier fell by as much as 0.9% to trade at a session low of USD2.775 per million British thermal units.
Prices hit a one-week high of USD2.808 per million British thermal units on Friday, after updated weather forecasts predicted some late-summer heat returning to key parts of the U.S., raising the prospect of increased gas demand over the Labor Day weekend.
Industry weather group MDA EarthSat said temperatures in the Midwest and across the East Coast were expected to be well above normal over the next five days.
Above-average summer temperatures increase the need for gas-fired electricity to cool homes, boosting demand for natural gas.
But prices remained under pressure amid ongoing concerns over bloated U.S. inventory levels.
Total U.S. gas supplies stood at 3.374 trillion cubic feet, 14.6% above last year’s level and 12% above the five-year average level for the week.
Inventory didn't top the 3.3-trillion cubic feet level in 2011 until the end of September, with stocks peaking at a record 3.852 trillion cubic feet in November of last year.
Market analysts have warned that without strong demand through the rest of the summer cooling season, gas inventories will reach the limits of available capacity later this year.
The storage surplus to last year will have to be cut by at least another 150 billion cubic feet in the 13 weeks left before winter withdrawals begin to avoid breaching the government's 4.1 trillion cubic feet estimate of total capacity.
Early injection estimates for this week’s storage data range from 21 billion cubic feet to 57 billion cubic feet, compared to last year's build of 62 billion cubic feet. The five-year average change for the week is an increase of 60 billion cubic feet.
A bout of extreme heat across much of the U.S. over the past two months helped boost natural gas prices above the key USD3.00-level in recent weeks. Prices rallied to a 2012 high of USD3.275 per million British thermal units on July 31.
But futures have come under heavy selling pressure since the start of August, losing almost 14% after extended weather forecasts pointed to milder weather across most parts of the U.S.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in October eased up 0.05% to trade at USD96.52 a barrel, while heating oil for October delivery added 0.03% to trade at USD3.181 per gallon.