Investing.com - Natural gas futures rallied nearly 2% to hit a
five-week high on Friday, as updated weather forecasting models
continued to point to colder than average temperatures in key
gas-consuming regions in the U.S.
Bullish speculators are betting that colder weather will increase
demand for the heating fuel. The heating season from November
through March is the peak demand period for U.S. gas consumption.
On the New York Mercantile Exchange, natural gas futures for
delivery in January jumped 1.9% on Friday to settle the week at
USD3.811 per million British thermal units.
Nymex gas prices rallied to a session high of USD3.830 earlier, the
strongest level since October 16. The January contract settled
0.73% higher on Thursday to end at USD3.740 per million British
Natural gas futures were likely to find support at USD3.722 per
million British thermal units, the low from November 22 and
resistance at USD3.868, the high from October 16.
On the week, December natural gas prices rose 3.96%, the third
consecutive weekly gain.
Updated weather forecasting models called for chilly temperatures
across most parts of the eastern half of the U.S. during the next
Natural gas prices have closely tracked weather forecasts in recent
weeks, as traders try to gauge the impact of shifting outlooks on
early-winter heating demand.
Meanwhile, upward momentum from Thursday's bullish U.S. supply data
also remained intact. The Energy Information Administration said
that natural gas storage in the U.S. fell by 45 billion cubic feet,
compared to expectations for a withdrawal of 33 billion cubic feet.
Inventories fell by 36 billion cubic feet in the same week a year
earlier, while the five-year average change for the week is a
decline of 2 billion cubic feet.
Total U.S. natural gas storage stood at 3.789 trillion cubic feet
as last week, 2.3% below last year's unusually high level but 0.4%
above the five-year average for this time of year.
Early estimates for next week's storage data range from a build of
7 billion cubic feet to a draw of 4 billion cubic feet, compared to
a drop of 2 billion cubic feet during the same week a year earlier.
The five-year average change for the week is a decline of 15
billion cubic feet.
Elsewhere in the energy complex, light sweet crude oil futures for
January delivery settled at USD94.84 a barrel by close of trade on
Friday, up 1.05% on the week.
Meanwhile, heating oil for January delivery rose 3.22% on the week
to settle at USD3.039 per gallon by close of trade Friday.
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