Investing.com - U.S. natural gas prices tumbled to the lowest level in almost five months on Monday, as demand for the fuel was likely to remain limited after meteorologists predicted mild fall weather in much of the U.S. in the week ahead.
Natural gas for delivery in October on the New York Mercantile Exchange hit an intraday low of $2.562 per million British thermal units, a level not seen since April 30, before trading at $2.569 during U.S. morning hours, down 3.6 cents, or 1.36%.
Demand for natural gas is expected to be moderate this week as cooler weather moves across the eastern part of the U.S. Meanwhile, weather in the west will be warmer before cooling off as the week progresses.
Summer heat has waned and cooler temperatures beckon with the approach of autumn. Natural gas accounts for about a quarter of U.S. electricity generation.
According to the Energy Information Administration, natural gas storage increased by 73 billion cubic feet last week, matching forecasts. Supplies rose by 90 billion cubic feet in the same week last year, while the five-year average change is an increase of 75 billion cubic feet.
Total U.S. natural gas storage stood at 3.334 trillion cubic feet, 15.8% higher than during the same week a year earlier and 4.1% 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, September 24 is expected to show a hefty build of approximately 105 billion cubic feet for the week ending September 18.
That compares with builds of 96 billion cubic feet in the same week last year, while the five-year average change for the week is an increase of 83 billion cubic feet.
Elsewhere on the Nymex, crude oil for delivery in November jumped $1.06, or 2.35%, to trade at $46.08 a barrel, while heating oil for October delivery rose 1.45% to trade at $1.512 per gallon.