Investing.com - Natural gas futures traded sharply lower Friday, continuing their downward slide, after Thursday’s report from the U.S. Energy Information Administration indicated U.S. gas supplies rose broadly in line with market expectations.
On the New York Mercantile Exchange, natural gas futures for delivery in July traded at USD2.325per million British thermal units during U.S. morning trade, plunging 3.98%.
On Thursday, the U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended May 25 rose by 71 billion cubic feet, broadly in line with expectations for an increase of 70 billion cubic feet.
Inventories rose by 89 billion cubic feet in the same week a year earlier, while the five-year average change for the week is an increase of 100 billion cubic feet, according to U.S. Energy Department data.
Total U.S. natural gas storage stood at 2.815 trillion cubic feet as of last week. Stocks were 732 billion cubic feet higher than last year at this time and 724 billion cubic feet above the five-year average of 2.091 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 368 billion cubic feet above the five-year average, following a net injection of 44 billion cubic feet.
Stocks in the Producing Region were 263 billion cubic feet above the five-year average of 817 billion cubic feet, after a net injection of 16 billion cubic feet.
Natural gas prices have been on the decline since touching a three-month high of USD2.820 on May 21, losing more than 14%.
Technical traders attributed the downward movement to a shaky technical chart outlook, after the market failed to break above key resistance close to USD2.820 a number of times.
Despite the recent losses, sentiment on the fuel has improved since touching a decade-low of USD1.902 on April 19. Prices are up more than 25% since then, amid indications major North American natural gas producers were cutting back on production.
Speculation that utility providers in the U.S. were switching from pricier coal to cheaper natural gas provided further support over recent weeks.
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.
Meanwhile, cooler weather forecasts and lower temperatures weighed on the commodity after meteorologists predicted normal or below-normal temperatures in the eastern half of the U.S. from May 30 through June 3.
Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Average or below-average summer temperatures decrease the need for gas-fired electricity to cool homes, dampening demand for natural gas.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July fell 3.81% to trade at USD83.22 a barrel.
On the New York Mercantile Exchange, natural gas futures for delivery in July traded at USD2.325per million British thermal units during U.S. morning trade, plunging 3.98%.
On Thursday, the U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended May 25 rose by 71 billion cubic feet, broadly in line with expectations for an increase of 70 billion cubic feet.
Inventories rose by 89 billion cubic feet in the same week a year earlier, while the five-year average change for the week is an increase of 100 billion cubic feet, according to U.S. Energy Department data.
Total U.S. natural gas storage stood at 2.815 trillion cubic feet as of last week. Stocks were 732 billion cubic feet higher than last year at this time and 724 billion cubic feet above the five-year average of 2.091 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 368 billion cubic feet above the five-year average, following a net injection of 44 billion cubic feet.
Stocks in the Producing Region were 263 billion cubic feet above the five-year average of 817 billion cubic feet, after a net injection of 16 billion cubic feet.
Natural gas prices have been on the decline since touching a three-month high of USD2.820 on May 21, losing more than 14%.
Technical traders attributed the downward movement to a shaky technical chart outlook, after the market failed to break above key resistance close to USD2.820 a number of times.
Despite the recent losses, sentiment on the fuel has improved since touching a decade-low of USD1.902 on April 19. Prices are up more than 25% since then, amid indications major North American natural gas producers were cutting back on production.
Speculation that utility providers in the U.S. were switching from pricier coal to cheaper natural gas provided further support over recent weeks.
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.
Meanwhile, cooler weather forecasts and lower temperatures weighed on the commodity after meteorologists predicted normal or below-normal temperatures in the eastern half of the U.S. from May 30 through June 3.
Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Average or below-average summer temperatures decrease the need for gas-fired electricity to cool homes, dampening demand for natural gas.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July fell 3.81% to trade at USD83.22 a barrel.