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Natural gas gains as heat wave sets sights on eastern U.S.

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Investing.com -

Investing.com - Natural gas futures traded near session highs on Friday after updated weather-forecasting models predicted a heat wave to trekk across the eastern U.S. in the coming days, which should hike demand for air conditioning.

On the New York Mercantile Exchange, natural gas futures for delivery in September traded at $3.957 per million British thermal units during U.S. trading, up 2.08%. The commodity hit a session low of $3.874, and a high of $3.960.

The September contract settled down 1.45% on Thursday to end at $3.876 per million British thermal units.

Natural gas futures were likely to find support at $3.858 per million British thermal units, Thursday's low, and resistance at $3.981, Thursday's high.

Above normal temperatures are expected to hover over the eastern U.S. starting Monday, and the heat wave will likely last all week, which sent natural gas prices rising on Friday.

New York City will see temperatures hit 93 degrees Fahrenheit on Thursday and Friday of next week, which should prompt households to crank up their air conditioners.

Investors continued to digest Thursday's supply report.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended August 1 rose by 82 billion cubic feet, below expectations for an increase of 84 billion cubic feet.

Still, inventories rose by 90 billion cubic feet in the same week a year earlier, while the five-year average change is a build of 49 billion cubic feet, which sent prices falling.

Injections of gas into storage have surpassed the five-year average for 16 consecutive weeks, alleviating concerns over tightening supplies.

Total U.S. natural gas storage stood at 2.389 trillion cubic feet. Stocks were 538 billion cubic feet less than last year at this time and 608 billion cubic feet below the five-year average of 2.948 trillion cubic feet for this time of year.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in September were up 0.02% at $97.36 a barrel, while heating oil for September delivery were down 0.58% at $2.8788 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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