Investing.com - Natural gas futures ended Friday’s session sharply higher, hitting a two-week high as forecasts showing above-average temperatures for the rest of the month boosted demand expectations for the fuel.
Prices accelerated gains towards the end of the session as a round of technical buying kicked in after prices broke firmly above the key USD4.00-level, triggering a flurry of automatic buy signals amid bullish chart signals.
On the New York Mercantile Exchange, natural gas futures for delivery in June surged 3.2% on Friday to settle the week at USD4.059 per million British thermal units.
Earlier in the session, Nymex gas prices rose to a session high of USD4.093 per million British thermal units, the strongest level since May 2.
The June contract rallied 3.85% on the week, the first weekly gain in four weeks.
Updated weather forecasting models pointed to a wider swath of above-normal temperatures in the central U.S. in the next two weeks, boosting near-term cooling demand expectations.
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.
Friday’s sharply rally came after prices tumbled 3.4% on Thursday after a report from the U.S. Energy Information Administration showed natural gas supplies rose more-than-expected last week.
The EIA data showed that natural gas storage in the U.S. rose by 99 billion cubic feet, above expectations for an increase of 95 billion cubic feet.
Inventories rose by 30 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a rise of 69 billion cubic feet.
Total U.S. natural gas storage stood at 1.964 trillion cubic feet as of last week, 4.1% below the five-year average for this time of year.
Early injection estimates for this week’s storage data range from 87 billion cubic feet to 100 billion cubic feet, compared to a 75 billion cubic feet increase during the same week a year earlier.
The five-year average for the week is a build of 90 billion cubic feet.
Elsewhere in the energy complex, light sweet crude oil futures for July delivery settled at USD96.29 a barrel by close of trade on Friday, adding 0.75% on the week.
Meanwhile, heating oil for June delivery advanced 2% over the week to settle at USD2.937 per gallon by close of trade Friday.