Natural Gas Futures Plunge Further After Bearish Weekly Storage Data

Investing.com – Natural gas futures declined on Thursday, falling to the lowest levels of the session after data showed that domestic supplies in storage fell less than forecast last week.

Front-month U.S. sank 14.2 cents, or around 4.7%, to $2.853 per million British thermal units (btu) by 10:32AM ET (1532GMT), the weakest level since Jan. 9. Futures were at around $2.888 prior to the release of the supply data.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. fell by (bcf) in the week ended Jan. 26, below forecasts for a withdrawal of 104 bcf.

That compared with a decline of 288 bcf in the preceding week, a fall of 87 bcf a year earlier and a five-year average drop of 160 bcf.

Total natural gas in storage currently stands at 2.197 trillion cubic feet (tcf), according to the U.S. Energy Information Administration.

That figure is 526 bcf, or around 19.3%, lower than levels at this time a year ago and 425 bcf, or roughly 16.2%, below the five-year average for this time of year.

U.S. gas futures , after updated weather forecasting models showed that temperatures won’t be as cold as previously expected through both the upcoming six- to 10-day and eight- to 14-day periods.

Bearish speculators are betting that the mild weather will reduce winter demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.

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