Investing.com - Natural gas futures fell to a seven-week low on Thursday, after data showed that U.S. natural gas supplies fell broadly in line with market expectations last week.
On the New York Mercantile Exchange, natural gas futures for delivery in April fell to a session low of $4.382 per million British thermal units, the weakest since January 21.
Natural gas last traded at $4.401 per million British thermal units during U.S. morning hours, down 2%, or 8.9 cents. Futures traded at $4.411 prior to the release of the supply data.
The April contract lost 2.5%, or 11.5 cents, on Wednesday to settle at $4.490 per million British thermal units amid concerns that the arrival of spring will bring warmer temperatures throughout the U.S. and cut into demand for heating.
Futures were likely to find support at $4.290 per million British thermal units, the low from January 21 and resistance at $4.631, the high from March 12.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended March 7 fell by 195 billion cubic feet, compared to expectations for a decline of 196 billion cubic feet.
Supplies fell by 145 billion cubic feet in the same week a year earlier, while the five-year average is a decline of 95 billion.
Total U.S. natural gas storage stood at 1.001 trillion cubic feet, the lowest for this time of year since 2004.
Stocks were 958 billion cubic feet less than last year at this time and 858 billion cubic feet below the five-year average of 1.859 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 395 billion cubic feet below the five-year average, following net withdrawals of 95 billion cubic feet.
Stocks in the Producing Region were 335 billion cubic feet below the five-year average of 737 billion cubic feet after a net withdrawal of 79 billion cubic feet.
Market analysts have warned that prices remain vulnerable to even further losses in the near-term as the coldest part of the winter has effectively passed and below-normal temperatures in March mean less than they do in January and February.
Updated weather-forecasting models called for above-normal temperatures across many densely populated areas in the U.S. in the next three to five days.
Spring and fall see the weakest demand for natural gas in the U.S, as the absence of extreme temperatures curbs demand for heating and air conditioning.
The heating season from November through March is the peak demand period for U.S. gas consumption. Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.
Natural gas rallied to a more than five-year high of $6.493 per million British thermal units on February 20 as frigid winter temperatures in the U.S. led households to burn a higher than normal amount of the fuel in furnaces to heat their homes.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in April inched up 0.04%, or $0.04 cents, to trade at $98.03 a barrel, while heating oil for April delivery slumped 0.3% to trade at $2.917 per gallon.