Natural gas futures - weekly outlook: November 17 - 21

Investing.com - U.S. natural gas futures rose for the first time in five sessions on Friday, as a round of short-covering and bargain-buying supported prices.

On the New York Mercantile Exchange, natural gas for delivery in December picked up 4.3 cents, or 1.08%, to settle at $4.020 per million British thermal units by close of trade.

Futures fell to a session low of $3.931 per million British thermal units earlier in the day, the weakest level since October 31.

Despite Friday's upbeat performance, Nymex natural gas prices plunged 39.2 cents, or 8.88%, on the week, as weather forecasting models pointed to milder temperatures across the U.S. later this month.

Futures were likely to find support at $3.931 per million British thermal units, Friday's low, and resistance at $4.175, the high from November 13.

The U.S. Energy Information Administration said in its weekly report released Friday that natural gas storage in the U.S. rose by 40 billion cubic feet, above expectations for an increase of 39 billion.

The data came out one day later than usual due to the Veterans Day holiday in the U.S. earlier in the week.

Inventories rose by 22 billion cubic feet in the same week a year earlier, while the five-year average change is a build of 16 billion cubic feet.

Injections of gas into storage have surpassed the five-year average for 30 consecutive weeks, alleviating concerns over tightening supplies.

Total U.S. natural gas storage stood at 3.611 trillion cubic feet as of last week, narrowing the deficit to the five-year average to 6.2% from a record 54.7% at the end of March.

Natural gas prices plummeted 20.8 cents, or 4.97%, on Thursday as weather forecasters predicted a return to warmer weather by the end of the month, cutting down on heating fuel demand.

The heating season from November through March is the peak demand period for U.S. gas consumption.

Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers turned bullish on natural gas futures in the week ending November 11.

Net longs totaled 8,739 contracts as of last week, compared to net shorts of 5,295 in the previous week.

Elsewhere on the Nymex, crude oil for December delivery settled at $75.82 a barrel by close of trade on Friday, down $2.83, or 3.59%, on the week.

Meanwhile, heating oil for December delivery slumped 3.32% on the week to settle at $2.416 per gallon by close of trade Friday.