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U.S. natural gas futures tumble for 2nd straight day

Published 05/16/2017, 09:31 AM
© Reuters.  U.S. natural gas futures slide again

Investing.com - U.S. natural gas futures were under pressure for the second day in a row on Tuesday, falling close to a one-week low after the latest U.S. weather model called for mild temperatures over the next two weeks, which should reduce demand during that time.

U.S. natural gas for June delivery slumped 8.0 cents, or around 2.4%, to $3.269 per million British thermal units by 9:30AM ET (13:30GMT). Prices of the heating fuel dropped 7.5 cents, or around 2.2%, on Monday.

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

Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.

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 55 and 63 billion cubic feet in the week ended May 12.

That compares with a gain of 45 billion cubic feet in the preceding week, an increase of 73 billion a year earlier and a five-year average rise of 87 billion cubic feet.

Total natural gas in storage currently stands at 2.301 trillion cubic feet, according to the U.S. Energy Information Administration, 13.9% lower than levels at this time a year ago but 12.0% above the five-year average for this time of year.

Latest comments

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