Natural gas prices fall as weather services point to warming temps

Shutterstock photo - Natural gas futures fell on Tuesday after once conflicting weather services came into agreement that temperatures are due remain warmer across much of the United States.

On the New York Mercantile Exchange, natural gas futures for delivery in February traded at USD3.209 per million British thermal units, down 1.73%.

The commodity hit a session low of USD3.203 and a high of USD3.280 in a session dominated by weather reports.

A National Weather Service six-to-10-day forecast issued on Sunday called for below or much-below-normal readings, while weather service provider WSI echoed those calls by predicting temperatures to fall below normal in the western half of the U.S. from January 13 through January 17.

Later on Monday, however, MDA Weather Services predicted warmer temperatures for the Midwest and eastern reaches of the country over the next two weeks, which sent prices falling, though on Tuesday, Commodity Weather Group LLC in Bethesda, Maryland, said cooler temps will remain confined to the northern swathes of the country.

High inventory levels pushed prices down as well.

The U.S. Energy Information Administration reported on Monday that gross U.S. gas production in October rose to 73.54 billion cubic feet per day, the second consecutive monthly record high.

Total U.S. natural gas storage stood at 3.517 trillion cubic feet as of last week, 0.7% higher than last year's level and 12.4% above the five-year average for this time of year.

Early withdrawal estimates for this Thursday's storage data range from 155 billion cubic feet to 176 billion cubic feet.

Inventories fell by 137 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 165 billion cubic feet.

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

The U.S. heating season running from November through March sees peak demand for gas.

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

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in February were down 0.03% and trading at USD93.16 a barrel, while heating oil for February delivery were up 0.81% and trading at USD3.0567 per gallon. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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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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