Investing.com - U.S. natural gas prices turned higher after falling to a two-week low on Monday, as market players assessed the outlook for U.S. demand and supply levels.
Natural gas for delivery in September on the New York Mercantile Exchange touched an intraday low of $2.739 per million British thermal units, the weakest level since July 10, before rebounding to trade at $2.814 during U.S. morning hours, up 3.9 cents, or 1.42%.
Updated weather forecasting models continued to call for above-normal temperatures across most parts of the U.S. next week, before a shift to cooler weather pushes readings to near normal across much of Northeast and Midwest in the following week.
Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Natural gas accounts for about a quarter of U.S. electricity generation.
According to the U.S. Energy Information Administration, natural gas storage in the U.S. rose by 68 billion cubic feet last week. Analysts had expected an increase of 70 billion cubic feet last week.
Supplies rose by 92 billion cubic feet in the same week last year, while the five-year average change is an increase of 53 billion cubic feet.
Total U.S. natural gas storage stood at 2.828 trillion cubic feet as of last week, 28.2% higher than during the same week a year earlier and 2.9% above the five-year average for this time of year.
Last spring, supplies were 55% below the five-year average, indicating producers have made up for all of last winter’s unusually strong demand.
The EIA's next storage report slated for release on Thursday, July 30 is expected to show a build of approximately 55 billion cubic feet for the week ending July 24.
Supplies rose by 88 billion cubic feet in the same week last year, while the five-year average change is an increase of 48 billion cubic feet.
Elsewhere on the Nymex, crude oil for delivery in September shed 39 cents, or 0.81%, to trade at $47.75 a barrel, while heating oil for August delivery dropped 0.93% to trade at $1.615 per gallon.