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Natural gas plummets as forecasts point to warmer weather

Published 12/31/2012, 01:31 PM
Updated 12/31/2012, 01:32 PM
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Investing.com - Natural gas futures tanked on Monday after meteorologists tweaked their forecasts for the next two weeks to the warmer side.

On the New York Mercantile Exchange, natural gas futures for delivery in February traded at USD3.374 per million British thermal units, down 2.72%.

Recent forecasts calling for cold weather to return in January moderated somewhat Monday.

Weather service provider MDA Weather said that it expected temperatures to warm up in the coming days through the second week of January.

Natural gas futures are very sensitive to weather reports in the U.S. winter.

The heating season from November through March sees peak demand for U.S. gas.

About half of U.S. households use gas for heating purposes, according to Energy Department data.

Meanwhile, U.S. natural gas storage fell less than expected in the week before last, official data revealed on Friday, though weather forecasts served as the market's chief weather vane.

In a report, the Energy Information Administration said that U.S. natural gas storage fell by 72 billion cubic feet last week to 3.652 trillion cubic feet, less than a decline of 82 billion cubic feet in the preceding week.

Analysts had expected U.S. natural gas storage to fall 76 billion cubic feet last week, though markets focused more on weather forecasts

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in February were up 0.83% and trading at USD91.55 a barrel, while heating oil for February delivery were up 0.41% and trading at USD3.0337 per gallon.





 

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