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Natural gas futures hit 28-month low after bearish storage data

CommoditiesJan 29, 2015 10:50AM ET
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© Reuters. Natural gas futures plunge to 28-month low after storage data

Investing.com - Natural gas futures plunged to a 28-month low on Thursday, after data showed that U.S. natural gas supplies fell less than forecast last week, underlining concerns over weak demand.

On the New York Mercantile Exchange, natural gas for delivery in March tumbled to $2.694 per million British thermal units, a level not seen since September 2012, before trading at $2.710 during U.S. morning hours, down 13.3 cents, or 4.66%.

Futures were likely to find support at $2.647 per million British thermal units, the low from September 2012, and resistance at $2.895, the high from January 28.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended January 23 fell by 94 billion cubic feet, compared to expectations for a decline of 113 billion and slowing from a drop of 216 billion in the previous week.

Inventories fell by 219 billion cubic feet in the same week a year earlier, while the five-year average change is a drop of 168 billion cubic feet.

Total U.S. natural gas storage stood at 2.543 trillion cubic feet. Stocks were 324 billion cubic feet higher than last year at this time and 79 billion cubic feet below the five-year average of 2.622 trillion cubic feet for this time of year.

A day earlier, natural gas lost 9.3 cents, or 3.17%, to settle at $2.842 as investors assessed the near-term demand outlook in the aftermath of Tuesday's Northeast blizzard.

Updated weather forecasting models said that below-normal temperatures in the East may give way to higher readings by the middle of February, dampening demand expectations for the heating fuel.

Bearish speculators are betting on the near-normal 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.

Natural gas prices have been extremely volatile in recent sessions as investors react to daily changes in weather patterns. Futures have either gained or declined more than 2% in 13 of the past 16 trading days.

Prices are down almost 40% since mid-November as an unusually mild start to winter limited demand while production soared.

Elsewhere on the Nymex, crude oil for delivery in March lost 45 cents, or 1.01%, to trade at $44.00 a barrel, while heating oil for March delivery slumped 0.29% to trade at $1.604 per gallon.

Natural gas futures hit 28-month low after bearish storage data
 

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Comments (4)
Yisheng Lee
Yisheng Lee Jan 29, 2015 2:17PM ET
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would some body tell me that where I can find out the gas storage level by next week. many thanks
big gas
big gas Jan 29, 2015 2:17PM ET
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http://americanoilman.homestead.com/GasStorage.html
big gas
big gas Jan 29, 2015 2:17PM ET
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http://www.eia.gov/naturalgas/data.cfm
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big gas Jan 29, 2015 2:08PM ET
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Pennsylvania governor bans new oil/gas leases on state land. PoliticsJan 29, 2015 03:52PM GMT Add a Comment. . © Reuters. Newly inaugurated Pennsylvania Governor Tom Wolf arrives at his © Reuters. Newly inaugurated Pennsylvania Governor Tom Wolf arrives at his "Let's Get Started" celebration at Hershey Lodg. (Reuters) - Pennsylvania Governor Tom Wolf on Thursday signed an executive order reinstating a moratorium on new leases for oil and natural gas development in state parks and forests.
big gas
big gas Jan 29, 2015 2:07PM ET
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House passes bill to pressure regulators on LNG exports. PoliticsJan 28, 2015 05:26PM GMT Add a Comment. . House passes bill to pressure regulators on LNG exportsHouse passes bill to pressure regulators on LNG exports. WASHINGTON (Reuters) - The U.S. House of Representatives passed a bill on Wednesday to speed permits for exports of natural gas, a measure that even if passed by the Senate and signed into law by President Barack Obama, is not expected to help bring much new fuel to global markets.
Matthew Schilling
Matthew Schilling Jan 29, 2015 12:37PM ET
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The cure for low prices is low prices. We need to get back to a big push for methanol - a liquid at room temperature. It is a very clean fuel that could be incorporated quite easily into our existing infrastructure (as opposed to CNG or LNG). I bet it would also be much less expensive and easier to ship overseas than LNG.
 
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