Investing.com - Natural gas futures turned choppy during U.S. morning hours on Thursday, but remained close to the highest level since September 2011 after a report from the U.S. Energy Information Administration showed natural gas supplies fell less-than-expected last week.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD3.966 per million British thermal units during U.S. morning trade, up 0.15% on the day.
Prices rose by as much as 1% earlier in the day to hit a session high of USD4.000 per million British thermal units, the strongest level since September 2011.
The April contract traded at USD3.971 prior to the release of the U.S. Energy Information Administration report.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended March 15 fell by 62 billion cubic feet, compared to expectations for a drop of 70 billion cubic feet.
Inventories withdrawals were flat in the same week a year earlier, while the five-year average change for the week is a decline of 26 billion cubic feet.
Total U.S. natural gas storage stood at 1.876 trillion cubic feet as of last week. Stocks were 502 billion cubic feet less than last year at this time and 162 billion cubic feet above the five-year average of 1.714 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 21 billion cubic feet above the five-year average, following net withdrawals of 47 billion cubic feet.
Stocks in the Producing Region were 63 billion cubic feet above the five-year average of 691 billion cubic feet after a net withdrawal of 15 billion cubic feet.
Natural gas prices were sharply higher earlier as weather forecasts continued to point to colder temperatures spreading across the eastern half of the U.S. over the next week.
In its one to five-day weather outlook, industry group MDA Weather Services said that below-normal temperatures were seen lingering in the East.
Bullish speculators are betting on the cold weather boosting late-winter demand for the heating fuel.
The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.
Natural gas prices have risen sharply in recent weeks. The heating fuel has rallied nearly 20% since falling close to a four-month low of USD3.125 per million British thermal units on February 15, boosted by calls for colder temperatures in major consuming regions across the U.S.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May fell 0.9% to trade at USD92.63 a barrel, while heating oil for April delivery shed 0.4% to trade at USD2.880 per gallon.
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