Investing.com - U.S. natural gas futures were lower for the second straight session on Tuesday, extending losses from the previous day as updated weather forecasting models pointed to mild temperatures across most parts of the U.S. in the weeks ahead.
Natural gas for delivery in August on the New York Mercantile Exchange shed 1.3 cents, or 0.48%, to trade at $2.689 per million British thermal units by 14:33GMT, or 10:33AM ET.
A day earlier, natural gas futures declined 9.9 cents, or 3.53%, as warm temperatures in key U.S. gas-consumption regions gave way to cooler readings.
Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use.
Natural gas storage in the U.S. rose by 39 billion cubic feet last week, according to the U.S. Energy Information Administration, below forecasts for an increase of 43 billion. That compared with builds of 37 billion cubic feet in the prior week, 87 billion a year earlier and a five-year average of 77 billion cubic feet.
Total U.S. natural gas storage stood at 3.179 trillion cubic feet, 16.9% higher than levels at this time a year ago and 18.8% above the five-year average for this time of year.
Unless intense summer heat boosts demand from power plants, stockpiles will test physical storage limits of 4.3 trillion cubic feet at the end of October.
Despite recent losses, prices are still up nearly 45% since late May as expectations have grown that hot summer weather will lead to heavy demand.
Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
In the week ahead, market players will be focusing on weekly U.S. storage data on Thursday for fresh supply-and-demand signals. Some analysts believe this week’s storage addition will be less than usual for this time of year due to a recent burst of warmer-than-normal summer weather across most parts of the U.S.