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U.S. natural gas futures rise back toward $3

CommoditiesMar 20, 2017 09:42AM ET
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© Reuters. U.S. natural gas futures kick the week off with gains

Investing.com - U.S. natural gas futures extended gains to a second session on Monday, as forecasts showing cooler weather on the way boosted the heating fuel.

U.S. natural gas for April delivery rallied 4.3 cents, or around 1.5% to $2.990 per million British thermal units by 9:40AM ET (13:40GMT).

Cool temperatures will sweep across the Great Lakes and eastern U.S. toward the middle of the week, according to forecasters at NatGasWeather.com, with overnight lows expected to drop well below freezing.

Temperatures are expected to remain much colder than normal through the end of the week, with highs struggling to reach the 30s, while overnight lows drop into the teens to below 0F.

A fast-moving weather system will then impact the east-central U.S. Saturday into Sunday, followed by warming Monday, but again cooling off mid-week.

Prices of the heating fuel are down around 20% so far this year as forecasts for warm winter weather weighed on heating demand expectations.

Based on data from the National Oceanographic and Atmospheric Administration, this year’s extremely warm winter has pushed heating demand for natural gas to nearly 20% below average.

About half of U.S. homes use natural gas for heating.

Without significant demand for natural gas, inventories could stay near record levels and may even continue to pull prices even lower.

Market participants looked ahead to weekly storage data due on Thursday, which is expected to show a draw in a range between 150 and 160 billion cubic feet in the week ended March 17.

That compares with a withdrawal of 53 billion cubic feet in the preceding week, a build of 15 billion a year earlier and a five-year average drop of 21 billion cubic feet.

Total natural gas in storage currently stands at 2.295 trillion cubic feet, according to the U.S. Energy Information Administration, 7.7% lower than levels at this time a year ago but 15.8% above the five-year average for this time of year.

U.S. natural gas futures rise back toward $3

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Leo Mu
Leo Mu Mar 20, 2017 8:47PM GMT
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Without significant drilling, natural gas inventories and productions will continue declining, prices will go even higher in coming weeks and months.
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Qual Mech
Qualmech Mar 21, 2017 1:51AM GMT
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NG production can quickly come back online.
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Tee Jay
EnergyGuy Mar 20, 2017 2:08PM GMT
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I would check weather reports on your own rather than believe what is printed in "U.S. natural gas futures rise back toward $3" on this site. All reports I find show a couple days of Chicago weather dipping into mid-20s F. Then rising above freezing into 40s by end of week. Maybe short-term spin by MMs on this report..
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