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Natural gas falls on springtime weather forecasts

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Investing.com -

Investing.com - Natural gas prices fell on Monday after updated weather-forecasting models called for mild temperatures to settle in across much of the U.S. over the coming week, which should crimp demand for heating.

On the New York Mercantile Exchange, natural gas futures for delivery in June traded at $4.451 per million British thermal units during U.S. trading, down 1.78%. The commodity hit session high of $4.547 and a low of $4.451.

The June contract settled down 0.90% on Friday to end at $4.531 per million British thermal units.

Natural gas futures were likely to find support at $4.222 per million British thermal units, the low from April 2, and resistance at $4.825, last Wednesday's high.

Updated weather forecasting models called for seasonably mild weather over much of the Midwest and Northeast through May 21, which was likely to lower heating demand.

Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.

Mild springtime temperatures weren't forecast to rise high enough to hike demand for air conditioning, which would require power generators to burn more natural gas to meet demand.

Elsewhere, investors braced for repeat bearish supply data.

Last week, the U.S. Energy Information Administration said that natural gas storage in the U.S. in the week ending May 2 rose by 74 billion cubic feet, above forecasts for an increase of 71 billion cubic feet.

The numbers sent prices falling, as investors were betting that a recent cool snap would have hiked demand on expectations for demand for heating to rise.

The five-year average change for the week is a build of 58 billion cubic feet.

Total U.S. natural gas storage stood at 1.055 trillion cubic feet. Stocks were 797 billion cubic feet less than last year at this time and 982 billion cubic feet below the five-year average of 2.037 trillion cubic feet for this time of year.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in June were up 0.67% at $100.66 a barrel, while Heating Oil for June delivery were up 0.57% at $2.9233 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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