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U.S. natural gas futures extend gains after upbeat storage data

Investing.com -

Investing.com - U.S. natural gas futures extended gains on Thursday morning, after data showed that natural gas supplies in storage in the U.S. rose less than forecast last week.

Natural gas for delivery in October on the New York Mercantile Exchange jumped 9.7 cents, or 3.62%, to trade at $2.773 per million British thermal units by 10:32AM ET (14:32GMT). Futures were at around $2.751 prior to the release of the supply data.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. rose by 36 billion cubic feet in the week ended September 2, below expectations for an increase of 43 billion.

That compared with a gain of 51 billion cubic feet in the preceding week, 72 billion a year earlier and a five-year average build of 64 billion cubic feet.

Total U.S. natural gas storage stood at 3.437 trillion cubic feet, 5.7% higher than levels at this time a year ago and 8.9% above the five-year average for this time of year.

On Wednesday, gas futures sank to a more than two-week low of $2.665 as traders reacted to the reality that higher summer demand for the commodity is coming to an end.

Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning.

But with autumn due to start on September 22, power burns to feed air conditioning demand have probably peaked for now, market analysts said.

Unless intense late-summer heat boosts demand from power plants, stockpiles could possibly test physical storage limits of 4.3 trillion cubic feet at the end of October.

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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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