Investing.com – Natural gas futures were down heavily for the second consecutive day on Tuesday, as concerns that U.S. natural gas inventories were ample to meet the needs of even an unusually cold winter weighed on prices.
On the New York Mercantile Exchange, natural gas futures for November delivery traded at USD3.587 per million British thermal units during U.S. morning trade, plunging 2.73%.
It earlier fell by as much as 2.98% to trade at USD3.577 per million British thermal units, the lowest price since October 14.
Following a three-day rally that took natural gas prices to an 11-day high of USD3.774 on Monday, investors turned their attention to rising U.S. supplies.
Over the past four weeks, more than 400 billion cubic feet of natural gas has been added to storage, bringing levels close to the multi-year highs reached last year.
U.S. inventories typically increase during the so-called "shoulder season", the period in autumn after air-conditioning demand falls but before heating begins.
But this year's increase, aided by unusually warm temperatures, offers a much larger cushion than in most years as winter approaches.
According to the U.S. Energy Information Administration, natural gas storage in the U.S. could rise to 3.77 trillion at the end of October. Supplies reached a record 3.84 trillion last November.
Concerns over rising production levels also weighed on prices. Industry research group Baker Hughes said that the number of active rigs drilling for natural gas in the U.S. last week climbed by one to a nine-and-a-half-month high of 936.
The gas rig count is up for four or the last five weeks and is at its highest since the week ended December 17, 2010, when the total stood at 941.
Natural gas traders closely watch the rig count to gauge future supply growth. A drop to the 800-rig-level would be necessary to begin to balance the market, according to Baker Hughes.
Meanwhile, industry weather group MDA Federal said earlier that it expects colder-than-normal weather in the southern U.S. states over the next 11-to-15 days, while forecasting mostly normal temperatures for the East Coast.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in December jumped 1.45% to trade at USD87.88 a barrel, while heating oil for November delivery edged up 0.19% to trade at USD3.019 per gallon.
On the New York Mercantile Exchange, natural gas futures for November delivery traded at USD3.587 per million British thermal units during U.S. morning trade, plunging 2.73%.
It earlier fell by as much as 2.98% to trade at USD3.577 per million British thermal units, the lowest price since October 14.
Following a three-day rally that took natural gas prices to an 11-day high of USD3.774 on Monday, investors turned their attention to rising U.S. supplies.
Over the past four weeks, more than 400 billion cubic feet of natural gas has been added to storage, bringing levels close to the multi-year highs reached last year.
U.S. inventories typically increase during the so-called "shoulder season", the period in autumn after air-conditioning demand falls but before heating begins.
But this year's increase, aided by unusually warm temperatures, offers a much larger cushion than in most years as winter approaches.
According to the U.S. Energy Information Administration, natural gas storage in the U.S. could rise to 3.77 trillion at the end of October. Supplies reached a record 3.84 trillion last November.
Concerns over rising production levels also weighed on prices. Industry research group Baker Hughes said that the number of active rigs drilling for natural gas in the U.S. last week climbed by one to a nine-and-a-half-month high of 936.
The gas rig count is up for four or the last five weeks and is at its highest since the week ended December 17, 2010, when the total stood at 941.
Natural gas traders closely watch the rig count to gauge future supply growth. A drop to the 800-rig-level would be necessary to begin to balance the market, according to Baker Hughes.
Meanwhile, industry weather group MDA Federal said earlier that it expects colder-than-normal weather in the southern U.S. states over the next 11-to-15 days, while forecasting mostly normal temperatures for the East Coast.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in December jumped 1.45% to trade at USD87.88 a barrel, while heating oil for November delivery edged up 0.19% to trade at USD3.019 per gallon.