Investing.com - Natural gas futures plunged Thursday as a report from the U.S. Energy Information Administration revealed the earliest seasonal increase in stored supplies in sixty months.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD2.26 per million British thermal units during U.S. morning trade, plummeting 4.05%.
The April contract traded at USD2.303 prior to the release of the U.S. Energy Information Administration report.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended March 16 rose by 11 billion cubic feet, after declining by 64 billion cubic feet in the preceding week.
Analysts had expected U.S. natural gas storage to rise by 10 billion cubic feet.
Inventories fell by 20 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 17 billion cubic feet, according to U.S. Energy Department data.
It was the earliest seasonal increase in stored supplies since 2007.
Total U.S. natural gas storage stood at 2.380 trillion cubic feet as of last week. Stocks were 766 billion cubic feet higher than last year at this time and 835 billion cubic feet above the five-year average of 1.545 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 356 billion cubic feet above the five-year average, following a withdrawal of 10 billion cubic feet.
Stocks in the Producing Region were 373 billion cubic feet above the five-year average of 612 billion cubic feet, after a net injection of 20 billion cubic feet.
Prices were under pressure before the supply data, as market sentiment has been dominated by concerns over elevated U.S. storage levels and mild weather that has limited demand for the fuel.
Natural gas prices have plunged almost 10% since the beginning of March and are down nearly 21% since the start of 2012.
Prices fell to USD2.208 per million British thermal units on Tuesday, March 13, the lowest since February 2002, amid forecasts for mild March weather and lingering concerns over record high U.S. inventory levels.
Tuesday marked the official start of spring in the U.S. and near-term weather forecasts continue to indicate that demand for the heating fuel will remain weak in the coming weeks.
Latest forecasts from the National Oceanic and Atmospheric Administration show above-normal temperatures covering most of the U.S. into early April, capping off an abysmal heating season for the U.S. natural-gas market.
According to the NOAA, temperatures in the continental U.S. in December through February were the warmest since 2000.
The agency said that the number of heating-degree days, a measure of energy demand, was 11% below the 30-year average for the October to February period.
Some market analysts expect prices to drop even further and test USD2.00 per million British thermal units amid expectations U.S. gas inventories will end the winter at a record high 2.2 trillion cubic feet, well above the previous high of 2.148 trillion set in 1983.
Total U.S. natural gas storage stood at 2.369 trillion cubic feet as of last week, 45% above year-ago levels and 52% higher than the five-year average of 1.562 trillion cubic feet.
Market participants noted that April is considered a transition month for natural gas.
Futures contracts tend to trade more lightly during spring months because demand for heating is weak and natural gas-fueled power plants have yet to step up production to serve air conditioners.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May fell 1.74% to trade at USD105.40 a barrel.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD2.26 per million British thermal units during U.S. morning trade, plummeting 4.05%.
The April contract traded at USD2.303 prior to the release of the U.S. Energy Information Administration report.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended March 16 rose by 11 billion cubic feet, after declining by 64 billion cubic feet in the preceding week.
Analysts had expected U.S. natural gas storage to rise by 10 billion cubic feet.
Inventories fell by 20 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 17 billion cubic feet, according to U.S. Energy Department data.
It was the earliest seasonal increase in stored supplies since 2007.
Total U.S. natural gas storage stood at 2.380 trillion cubic feet as of last week. Stocks were 766 billion cubic feet higher than last year at this time and 835 billion cubic feet above the five-year average of 1.545 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 356 billion cubic feet above the five-year average, following a withdrawal of 10 billion cubic feet.
Stocks in the Producing Region were 373 billion cubic feet above the five-year average of 612 billion cubic feet, after a net injection of 20 billion cubic feet.
Prices were under pressure before the supply data, as market sentiment has been dominated by concerns over elevated U.S. storage levels and mild weather that has limited demand for the fuel.
Natural gas prices have plunged almost 10% since the beginning of March and are down nearly 21% since the start of 2012.
Prices fell to USD2.208 per million British thermal units on Tuesday, March 13, the lowest since February 2002, amid forecasts for mild March weather and lingering concerns over record high U.S. inventory levels.
Tuesday marked the official start of spring in the U.S. and near-term weather forecasts continue to indicate that demand for the heating fuel will remain weak in the coming weeks.
Latest forecasts from the National Oceanic and Atmospheric Administration show above-normal temperatures covering most of the U.S. into early April, capping off an abysmal heating season for the U.S. natural-gas market.
According to the NOAA, temperatures in the continental U.S. in December through February were the warmest since 2000.
The agency said that the number of heating-degree days, a measure of energy demand, was 11% below the 30-year average for the October to February period.
Some market analysts expect prices to drop even further and test USD2.00 per million British thermal units amid expectations U.S. gas inventories will end the winter at a record high 2.2 trillion cubic feet, well above the previous high of 2.148 trillion set in 1983.
Total U.S. natural gas storage stood at 2.369 trillion cubic feet as of last week, 45% above year-ago levels and 52% higher than the five-year average of 1.562 trillion cubic feet.
Market participants noted that April is considered a transition month for natural gas.
Futures contracts tend to trade more lightly during spring months because demand for heating is weak and natural gas-fueled power plants have yet to step up production to serve air conditioners.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May fell 1.74% to trade at USD105.40 a barrel.