Investing.com - Natural gas futures were higher for the fifth consecutive day on Tuesday, with prices trading just below the previous session’s 17-month high as forecasts continued to point to colder weather in the next two weeks.
On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD3.916 per million British thermal units during U.S. morning trade, up 0.85% on the day.
Prices rose by as much as 1.1% earlier in the day to hit a session high of USD3.924 per million British thermal units.
Nymex gas prices rallied to USD3.964 per million British thermal units on Monday, the strongest level since October 31, 2011.
Natural gas prices have risen sharply in recent weeks. The heating fuel has rallied nearly 20% since falling close to a four-month low of USD3.125 per million British thermal units on February 15, boosted by calls for colder temperatures in major consuming regions across the U.S.
Sentiment on the heating fuel remained upbeat after updated weather forecasts released earlier continued to call for below-normal readings for most of the Eastern half of the U.S. in the next six-to-ten days.
Industry weather group MDA Weather Services said that mostly lower-than-normal temperatures were forecast for most of the country for the rest of March.
The latest U.S. National Weather Service six to 10-day forecast issued Monday also called for below or much-below-normal temperatures for most of the eastern half of the country.
Bullish speculators are betting on the cool weather increasing late-winter demand for the heating fuel.
The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.
Easing concerns over bloated U.S. inventory levels also contributed to gains. The U.S. Energy Information Administration said last week that natural gas storage in the U.S. fell by 145 billion cubic feet.
Total U.S. natural gas storage stood at 1.938 trillion cubic feet as of last week, 18.5% below their level this time last year, but still 11.4% above the five-year average.
Early withdrawal estimates for this Thursday’s storage data range from 48 billion cubic feet to 73 billion cubic feet.
Inventories withdrawals were flat in the same week a year earlier, while the five-year average change for the week is a decline of 26 billion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in April fell 0.1% to trade at USD94.00 a barrel, while heating oil for April delivery shed 1% to trade at USD2.897 per gallon.