Investing.com - Natural gas futures rallied to six-week high during U.S. morning trade on Tuesday, as near-term weather forecasts continued to predict cold temperatures, boosting near-term demand expectations for the heating fuel.
Natural gas prices have closely tracked shifting weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts on late-winter heating demand.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD3.558 per million British thermal units during U.S. morning trade, up 0.8% on the day.
Prices rose by as much as 1.5% earlier in the day to hit a session high of USD3.583 per million British thermal units, the strongest level since January 24.
Sentiment on the heating fuel remained upbeat after weather forecasts released earlier showed sharply colder temperatures spreading across the eastern half of the U.S. over the next week.
Bullish speculators are betting on the cold weather boosting late-winter demand for the heating fuel.
The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.
Market analysts have warned that prices remain vulnerable in the near-term as the coldest part of the winter has effectively passed and below-normal temperatures in February and March mean less than they do in January.
Concerns over bloated inventory levels were also likely to keep a lid on significant gains.
Total U.S. natural gas storage stood at 2.299 trillion cubic feet as of last week, 16% above the five-year average for this time of year.
Early withdrawal estimates for this week’s storage data range from 120 billion cubic feet to 160 billion cubic feet.
Inventories fell by 92 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 107 billion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in April added 0.3% to trade at USD90.38 a barrel, while heating oil for April delivery rose 0.95% to trade at USD2.947 per gallon.
Natural gas prices have closely tracked shifting weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts on late-winter heating demand.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD3.558 per million British thermal units during U.S. morning trade, up 0.8% on the day.
Prices rose by as much as 1.5% earlier in the day to hit a session high of USD3.583 per million British thermal units, the strongest level since January 24.
Sentiment on the heating fuel remained upbeat after weather forecasts released earlier showed sharply colder temperatures spreading across the eastern half of the U.S. over the next week.
Bullish speculators are betting on the cold weather boosting late-winter demand for the heating fuel.
The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.
Market analysts have warned that prices remain vulnerable in the near-term as the coldest part of the winter has effectively passed and below-normal temperatures in February and March mean less than they do in January.
Concerns over bloated inventory levels were also likely to keep a lid on significant gains.
Total U.S. natural gas storage stood at 2.299 trillion cubic feet as of last week, 16% above the five-year average for this time of year.
Early withdrawal estimates for this week’s storage data range from 120 billion cubic feet to 160 billion cubic feet.
Inventories fell by 92 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 107 billion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in April added 0.3% to trade at USD90.38 a barrel, while heating oil for April delivery rose 0.95% to trade at USD2.947 per gallon.