Investing.com - Natural gas futures ended Friday's session up
nearly 3%, after a report from the U.S. Energy Information
Administration showed natural gas supplies fell more-than-expected
last week.
Meanwhile, market players continued to focus on shifting weather
forecasts for the next few weeks to gauge the strength of U.S.
heating demand.
Natural gas prices have closely tracked weather forecasts in recent
weeks, as traders try to gauge the impact of shifting forecasts on
winter heating demand.
On the New York Mercantile Exchange, natural gas futures for
delivery in February jumped 2.85% Friday to settle at USD3.289 per
million British thermal units by close of trade.
Despite Friday's strong gain, natural gas prices fell 5.1% during
the holiday-shortened week. Markets were closed on Tuesday, New
Year's Day.
The U.S. Energy Information Administration said Friday that natural
gas storage in the U.S. in the week ended December 28 fell by 135
billion cubic feet, compared to expectations for a decline of 127
billion cubic feet.
Inventories fell by 77 billion cubic feet in the same week a year
earlier, while the five-year average change for the week is a
decline of 111 billion cubic feet.
Total U.S. natural gas storage stood at 3.517 trillion cubic feet
as of last week, 0.7% higher than last year's level and 12.4% above
the five-year average for this time of year.
The Energy Department released its weekly report one day later than
usual because of New Year's Day holiday.
Early withdrawal estimates for next week's storage data range from
155 billion cubic feet to 176 billion cubic feet.
Inventories fell by 137 billion cubic feet in the same week a year
earlier, while the five-year average change for the week is a
decline of 165 billion cubic feet.
Natural gas prices plunged to the lowest level since late-September
on Thursday, as forecasts showing mild weather across most parts of
the U.S. in the first two weeks of January weighed on sentiment.
The latest National Weather Service six-to-10-day forecast issued
on Thursday again called for above-normal temperatures for the
eastern half of the U.S.
Bearish speculators are betting on the above-average weather
reducing winter demand for the heating fuel. The heating season
from November through March is the peak demand period for U.S. gas
consumption.
The heating fuel has lost nearly 18% since touching a 14-month high
of USD4.001 per million British thermal units on November 26, on
speculation that temperatures won't be cold enough to erase a
surplus of the fuel in storage.
Elsewhere in the energy complex, light sweet crude oil futures for
February delivery settled at USD93.08 a barrel by close of trade on
Friday, adding 2.5% on the week.
Meanwhile, heating oil for February delivery dipped 0.15% over the
week to settle at USD3.020 per gallon by close of trade Friday.
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