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U.S. natural gas futures recover after falling to 3-week low

Published 04/19/2017, 09:12 AM
Updated 04/19/2017, 09:12 AM
© Reuters.  U.S. natural gas futures bounce higher

Investing.com - U.S. natural gas futures were higher on Wednesday, bouncing off the prior session's three-week low as traders monitored shifting weather forecasts to assess the outlook for early-spring demand and supply levels.

U.S. natural gas for May delivery tacked on 6.4 cents, or around 2%, to $3.208 per million British thermal units by 9:10AM ET (13:10GMT).

It lost 1.8 cents on Tuesday after hitting its lowest since March 29 at $3.114.

Weather patterns are expected to be rather bearish through Thursday due to mostly mild temperatures dominating much of the country beside the far northern U.S., according to forecasters at NatGasWeather.com.

However, a colder weather system will track over the southern and eastern U.S. from Friday through next Wednesday to bring an increase in demand to stronger levels.

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

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.

Meanwhile, market participants looked ahead to weekly storage data due on Thursday, which is expected to show a build in a range between 40 and 50 billion cubic feet in the week ended April 14.

That compares with a gain of 10 billion cubic feet in the preceding week, a gain of 7 billion a year earlier and a five-year average rise of 35 billion cubic feet.

Total natural gas in storage currently stands at 2.061 trillion cubic feet, according to the U.S. Energy Information Administration, 20.2% lower than levels at this time a year ago but 12.8% above the five-year average for this time of year.

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