Investing.com - Natural gas futures held steady on Thursday, after tumbling below the key psychological level of USD2.00 for the first time in more than a decade on Wednesday.
On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD1.983 per million British thermal units during European morning trade, easing down 0.05%.
The May contract traded in a tight range between USD1.988, a daily high and a session low of USD1.972 per million British thermal units.
Prices fell to as low as USD1.970 on Wednesday, the lowest since January 29, 2002, as traders looked towards a U.S. government report on natural gas inventories, which was expected to show another supply injection.
Prices settled at USD1.984, the first settlement below USD2.00 since January 2002.
Futures have been hitting a string of fresh 10-year lows over the past two weeks, as the bearish sentiment on the heating fuel remained intact amid ongoing concerns over waning demand and elevated U.S. storage levels.
Natural gas prices have plunged almost 22% since the beginning of March and are down nearly 32% since the start of 2012. The commodity has lost approximately 55% of its value over the past 12 months.
Traders and market analysts have been anticipating the drop below the USD2.00-level in recent weeks. Some market participants are now expecting prices to test the all-time low of USD1.02 hit in 1992. amid expectations gas stockpiles will continue to rise throughout the next few months as demand weakens.
Gas traders looked forward to the U.S. Energy Information Administration’s closely-watched weekly report on natural gas inventories due later Thursday.
The data was expected to show an injection of 25 billion cubic feet, compared to last year's build of 7 billion cubic feet. The five-year average change for the week is an increase of 22 billion cubic feet.
An increase of that size would put inventory at a record 2.505 trillion cubic feet for this time of year. Stocks would increase to 60% above the five-year average and 57% above the year-ago level.
About half of all U.S. homes are heated using natural gas, and prices typically rise in the winter. But this winter was one of the mildest on record.
According to the U.S. National Oceanic and Atmospheric Administration, last month was the warmest March ever recorded in the U.S. and current weather forecasts suggest temperatures are not likely to fall significantly again this season.
On top of that, the U.S. gas market is entering the so-called shoulder season. Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
Wall Street investment bank Goldman Sachs lowered its average 2012 price forecast to USD2.40 per million British thermal units, down from a previous forecast of USD3.10.
However, the investment bank expected prices to rebound in 2013 and average USD3.36 per million British thermal units.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May rose 0.45% to trade at USD103.16 a barrel, while heating oil for May delivery was flat to trade at USD3.114 per gallon.
On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD1.983 per million British thermal units during European morning trade, easing down 0.05%.
The May contract traded in a tight range between USD1.988, a daily high and a session low of USD1.972 per million British thermal units.
Prices fell to as low as USD1.970 on Wednesday, the lowest since January 29, 2002, as traders looked towards a U.S. government report on natural gas inventories, which was expected to show another supply injection.
Prices settled at USD1.984, the first settlement below USD2.00 since January 2002.
Futures have been hitting a string of fresh 10-year lows over the past two weeks, as the bearish sentiment on the heating fuel remained intact amid ongoing concerns over waning demand and elevated U.S. storage levels.
Natural gas prices have plunged almost 22% since the beginning of March and are down nearly 32% since the start of 2012. The commodity has lost approximately 55% of its value over the past 12 months.
Traders and market analysts have been anticipating the drop below the USD2.00-level in recent weeks. Some market participants are now expecting prices to test the all-time low of USD1.02 hit in 1992. amid expectations gas stockpiles will continue to rise throughout the next few months as demand weakens.
Gas traders looked forward to the U.S. Energy Information Administration’s closely-watched weekly report on natural gas inventories due later Thursday.
The data was expected to show an injection of 25 billion cubic feet, compared to last year's build of 7 billion cubic feet. The five-year average change for the week is an increase of 22 billion cubic feet.
An increase of that size would put inventory at a record 2.505 trillion cubic feet for this time of year. Stocks would increase to 60% above the five-year average and 57% above the year-ago level.
About half of all U.S. homes are heated using natural gas, and prices typically rise in the winter. But this winter was one of the mildest on record.
According to the U.S. National Oceanic and Atmospheric Administration, last month was the warmest March ever recorded in the U.S. and current weather forecasts suggest temperatures are not likely to fall significantly again this season.
On top of that, the U.S. gas market is entering the so-called shoulder season. Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
Wall Street investment bank Goldman Sachs lowered its average 2012 price forecast to USD2.40 per million British thermal units, down from a previous forecast of USD3.10.
However, the investment bank expected prices to rebound in 2013 and average USD3.36 per million British thermal units.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May rose 0.45% to trade at USD103.16 a barrel, while heating oil for May delivery was flat to trade at USD3.114 per gallon.