Investing.com - U.S. natural gas futures rose to a near five-month high on Friday, before turning lower to end the session down 5% as weather forecasting models pointed to less frigid temperatures across the U.S. later this month.
On the New York Mercantile Exchange, natural gas for delivery in December tumbled 22.3 cents, or 4.97%, on Friday to settle at $4.266 per million British thermal units by close of trade.
Nymex gas prices touched a session high of $4.532 per million British thermal units earlier in the day, just below a five-month peak of $4.544 hit on November 10.
Futures were likely to find support at $4.194 per million British thermal units, the low from November 19, and resistance at $4.544, the high from November 10.
Natural gas came under pressure as milder temperatures were expected to spread across most parts of the U.S., after a blast of cold air swept through much of the country earlier in the week, prompting investors to bet that utilities and homes will burn less natural gas as demand for heating falls.
Despite Friday's downbeat performance, Nymex natural gas prices soared 24.6 cents, or 5.76%, on the week, as blistering cold air blasted across most of the U.S. in the early part of the week.
The frigid weather outlook sent natural gas prices soaring on expectations for households and business to crank up their heating and send thermal power plants to burn more of the commodity to meet demand.
Meanwhile, the U.S. Energy Information Administration said in its weekly report released Thursday that natural gas storage in the U.S. fell by 17 billion cubic feet last week, compared to expectations for a decline of 12 billion.
Inventories fell by 36 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 10 billion cubic feet.
It was the first storage draw of the heating season. The heating season from November through March is the peak demand period for U.S. gas consumption.
Total U.S. natural gas storage stood at 3.594 trillion cubic feet as of last week, narrowing the deficit to the five-year average to 6.4% from a record 54.7% at the end of March.
Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers increased their bullish on natural gas futures in the week ending November 18.
Net longs totaled 16,909 contracts as of last week, compared to net longs of 8,739 in the previous week.
Elsewhere on the Nymex, crude oil for January delivery settled at $76.51 a barrel by close of trade on Friday, up 69 cents, or 0.9%, on the week.
Meanwhile, heating oil for December delivery slumped 0.45% on the week to settle at $2.405 per gallon by close of trade Friday.