Investing.com - U.S. natural gas futures tumbled more than 6% to
hit a two-week low on Friday, as updated weather forecasting models
for the first two weeks of December pointed to a return to mild
weather, prompting investors to bet that utilities and homes will
burn less natural gas as demand for heating falls.
On the New York Mercantile Exchange, natural gas for delivery in
January plunged 27.1 cents, or 6.22%, on Friday to settle at $4.084
per million British thermal units by close of trade.
Nymex gas prices touched a session low of $4.079 per million
British thermal units earlier in the day, the weakest level since
Futures were likely to find support at $3.931 per million British
thermal units, the low from November 14, and resistance at $4.367,
the high from November 28.
lost 18.2 cents, or 4.26%, on the week, as forecasts for milder
temperatures to settle in across much of the U.S. in early December
Bearish speculators are betting on the mild weather to dampen
demand for the heating fuel. The heating season from November
through March is the peak demand period for U.S. gas consumption.
Meanwhile, the U.S. Energy Information Administration said in its
weekly report that natural gas storage in the U.S. fell by 162
billion cubic feet last week, compared to expectations for a
decline of 150 billion.
The five-year average change for the week is a drop of 6 billion
Total U.S. natural gas storage stood at 3.432 trillion cubic feet
as of last week, 9.2% below year-ago levels and nearly 10.4% below
the five-year average for this time of year.
Natural gas prices had been on a roller coaster through November as
investors reacted to daily changes in weather patterns.
Despite the disappointing weekly performance, natural gas futures
rose 5.6% in November as expectations of cooler-than-normal
temperatures at the start of the heating season had lifted prices
earlier in the month.
Elsewhere on the Nymex, crude oil for January delivery settled at
$66.15 a barrel by close of trade on Friday, down $10.36, or
13.54%, on the week.
Nymex oil futures plunged to levels not seen in more than four
years on Friday, after the Organization of the Petroleum Exporting
Countries decided not to cut output at the conclusion of its
Meanwhile, heating oil for January delivery slumped 10.14% on the
week to settle at $2.161 per gallon by close of trade Friday.
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