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Natural Gas dips amid profit taking after talk of cooling weather

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Investing.com - Profit taking sent natural gas futures falling in afternoon trading on Tuesday after a choppy morning that saw the commodity jump in and out of positive territory on talk of a blast of cold air shooting across the central U.S. and hiking up demand for heating.

On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD4.125 per million British thermal units, down 0.29%.

The commodity hit a session low of USD4.085 and a high of USD4.194.

Talk that a cold front will cool portions of the central U.S. sent prices gaining earlier until investors locked in profits and sold.

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

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

The U.S. heating season running from November through March sees peak demand for gas, though late-season cold snaps have sent prices rallying in recent weeks.

Supply data released Thursday confirmed many suspicions that supplies are tight due to repeated waves of cold snaps sweeping across the U.S. in late winter and early spring.

The U.S. Energy Information Administration said in its weekly report on Thursday that natural gas storage in the U.S. in the week ended April 5 fell by 14 billion cubic feet, compared to expectations for a drop of 13 billion cubic feet.

Inventories increased by 11 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a build of 15 billion cubic feet.

Total U.S. natural gas storage stood at 1.673 trillion cubic feet as of last week. Stocks were 804 billion cubic feet less than last year at this time and 66 billion cubic feet below the five-year average of 1.739 trillion cubic feet for this time of year.

The report showed that in the East Region, stocks were 92 billion cubic feet below the five-year average, following net withdrawals of 16 billion cubic feet.

Stocks in the Producing Region were 46 billion cubic feet below the five-year average of 736 billion cubic feet after a net withdrawal of 5 billion cubic feet.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in June were down 0.16% and trading at USD88.89 a barrel, while heating oil futures for May delivery were down 1.08% at USD2.7986 per gallon.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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