Natural gas falls as weather models call for cooler weather
Investing.com - Natural gas prices on Wednesday erased Tuesday's
gains after weather reports eased up on their forecasts for warmer
temperatures setting in over the central and eastern swathes of the
country, with some indicating cool snaps.
On the New York Mercantile Exchange, natural gas futures for delivery in June traded at USD4.169 per million British thermal units, down 0.56%.
The commodity hit a session low of USD4.157 and a high of USD4.228.
Weather forecasting models predicted cooler-than-normal temperatures for portions of the central U.S., which sent natural gas prices falling on sentiment the nation's thermal power plants will demand less gas than anticipated.
Natural gas prices tend to rise when hotter weather prompts households and businesses up their air conditioners.
Gas prices shot up 7% over the last three sessions on weather reports of hotter temperatures, though forecasts for even below-normal temperatures for parts of the central U.S. sparked profit taking on Wednesday.
Investors also kept a cautious eye towards Thursday's weekly inventory data.
The U.S. Energy Information Administration said last week that natural gas storage in the U.S. rose by 99 billion cubic feet, above expectations for an increase of 95 billion cubic feet.
Total U.S. natural gas storage stood at 1.865 trillion cubic feet as of last week, 5% below the five-year average for this time of year.
Early injection estimates for this week's storage data range from 87 billion cubic feet to 100 billion cubic feet, compared to a 75 billion cubic feet increase during the same week a year earlier.
The five-year average for the week is a build of 90 billion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July were down 1.45% and trading at USD94.79 a barrel, while heating oil futures for June delivery were down 1.73% at USD2.8871 per gallon.
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