We have updated our privacy policy and terms & conditions. Find out more here.

Natural gas futures tumble 2% on mild weather forecasts

CommoditiesDec 31, 2012 01:06PM GMT Add a Comment
Share with a Friend
Thanks for sharing
Emails have been sent to:
To send more emails click here
Investing.com - Natural gas futures fell more than 2% in holiday-thinned trade on Monday, as forecasts showing warmer-than-normal weather across most parts of the U.S. in January weighed on sentiment.

Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts on winter heating demand.

On the New York Mercantile Exchange, natural gas futures for delivery in February traded at USD3.389 per million British thermal units during U.S. morning trade, down 2.3% on the day.       

It earlier fell by as much as 2.5% to trade at a session low of USD3.382 per million British thermal units.

Updated weather forecasts released over the weekend showed that warmer-than-normal weather was expected across key parts of the U.S. during the first two weeks of January, dampening sentiment on the heating fuel.

Weather service provider MDA Weather said that it expected a recent bout of cold temperatures to moderate and turn warmer during the second week of January.

Earlier forecasts made last week predicted colder temperatures in store for the U.S.

Bearish speculators are betting on the mild weather reducing winter demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.

Meanwhile, investors remained concerned over bloated U.S. inventory levels. The U.S. Energy Information Administration said on Friday that natural gas storage in the U.S. fell by 72 billion cubic feet to a total of 3.652 trillion cubic feet.

Stocks are 2.5% higher than last year at this time and 13% above the five-year average for this time of year.

The EIA report was delayed by one day this week due to the Christmas holiday and will be delayed by one day again next week due to the New Year holiday.

Early withdrawal estimates for next week’s storage data range from 100 billion cubic feet to 141 billion cubic feet.

Inventories fell by 77 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 111 billion cubic feet.

For the year, U.S. natural gas prices rose nearly 13%, amid indications major North American natural gas producers were cutting back on production in response to lower prices.

Natural gas prices fell to a ten-year low of USD1.902 per million British thermal units on April 19.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in February shed 0.25% to trade at USD88.43 a barrel, while heating oil for February delivery dipped 0.45% to trade at USD2.997 per gallon.

Natural gas futures tumble 2% on mild weather forecasts

Related Articles

Oil drops to $55 as Iran nuclear talks intensify
Oil drops to $55 as Iran nuclear talks intensify
By Reuters - Mar 31, 2015

By Ron Bousso LONDON (Reuters) - Brent crude oil dropped towards $55 a barrel on Tuesday as Iran and six world powers entered a final day of talks over a nuclear deal that could ...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Are you sure you want to delete this chart?
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?

Successfully Reported

Thank you. This comment has been flagged for a moderator.
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data .

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.