Investing.com - Natural gas futures traded higher during U.S. afternoon trade Thursday, as a report from the U.S. Energy Information Administration indicated U.S. gas supplies advanced slightly less-than-expected last week.
On the New York Mercantile Exchange, natural gas futures for delivery in June traded at USD2.477 per million British thermal units during U.S. afternoon trade, gaining 0.43%.
It earlier climbed 1.8% to trade at a session high of USD2.498 per million British thermal units.
The June contract traded at USD2.460 prior to the release of the U.S. Energy Information Administration report. Prices immediately spiked higher to USD2.493 after the data, before retracing gains.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended May 4 rose by 30 billion cubic feet, below expectations for an increase of 34 billion cubic feet.
Inventories rose by 71 billion cubic feet in the same week a year earlier, while the five-year average change for the week is an increase of 84 billion cubic feet, according to U.S. Energy Department data.
Total U.S. natural gas storage stood at 2.606 trillion cubic feet as of last week. Stocks were 799 billion cubic feet higher than last year at this time and 803 billion cubic feet above the five-year average of 1.803 trillion cubic feet for this time of year.
The report indicated that in the East Region, stocks were 400 billion cubic feet above the five-year average, following a net injection of 24 billion cubic feet.
Stocks in the Producing Region were 299 billion cubic feet above the five-year average of 739 billion cubic feet, after a net withdrawal of 2 billion cubic feet.
Sentiment on the heating fuel has improved in recent weeks after hitting a string of fresh 10-year lows.
Prices are up almost 25% since hitting a decade-low of USD1.902 on April 19, amid indications major North American natural gas producers were cutting back on production in response to lower prices.
Speculation that utility providers in the U.S. were switching from pricier coal to cheaper natural gas provided further support over recent sessions. U.S. power companies used 34% more gas in February than a year earlier, Energy Department data showed.
However, market players noted that sustained prices back above USD2.50 and toward the USD3.00-level likely would inspire some switching back to coal.
Despite the recent rally, prices remain vulnerable to a downside correction in the near-term as traders remain concerned over elevated U.S. storage levels.
If weekly stock builds through October match the five-year average, inventories would top out at 4.532 trillion cubic feet, 9% over peak capacity estimates of about 4.1 trillion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in June rose 0.04% to trade at USD96.87 a barrel.
On the New York Mercantile Exchange, natural gas futures for delivery in June traded at USD2.477 per million British thermal units during U.S. afternoon trade, gaining 0.43%.
It earlier climbed 1.8% to trade at a session high of USD2.498 per million British thermal units.
The June contract traded at USD2.460 prior to the release of the U.S. Energy Information Administration report. Prices immediately spiked higher to USD2.493 after the data, before retracing gains.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended May 4 rose by 30 billion cubic feet, below expectations for an increase of 34 billion cubic feet.
Inventories rose by 71 billion cubic feet in the same week a year earlier, while the five-year average change for the week is an increase of 84 billion cubic feet, according to U.S. Energy Department data.
Total U.S. natural gas storage stood at 2.606 trillion cubic feet as of last week. Stocks were 799 billion cubic feet higher than last year at this time and 803 billion cubic feet above the five-year average of 1.803 trillion cubic feet for this time of year.
The report indicated that in the East Region, stocks were 400 billion cubic feet above the five-year average, following a net injection of 24 billion cubic feet.
Stocks in the Producing Region were 299 billion cubic feet above the five-year average of 739 billion cubic feet, after a net withdrawal of 2 billion cubic feet.
Sentiment on the heating fuel has improved in recent weeks after hitting a string of fresh 10-year lows.
Prices are up almost 25% since hitting a decade-low of USD1.902 on April 19, amid indications major North American natural gas producers were cutting back on production in response to lower prices.
Speculation that utility providers in the U.S. were switching from pricier coal to cheaper natural gas provided further support over recent sessions. U.S. power companies used 34% more gas in February than a year earlier, Energy Department data showed.
However, market players noted that sustained prices back above USD2.50 and toward the USD3.00-level likely would inspire some switching back to coal.
Despite the recent rally, prices remain vulnerable to a downside correction in the near-term as traders remain concerned over elevated U.S. storage levels.
If weekly stock builds through October match the five-year average, inventories would top out at 4.532 trillion cubic feet, 9% over peak capacity estimates of about 4.1 trillion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in June rose 0.04% to trade at USD96.87 a barrel.