Investing.com – Natural gas futures declined on Tuesday, extending losses from the previous session amid speculation the start of spring will bring warmer temperatures throughout the U.S. and cut into demand for the fuel.
Spring usually sees the weakest demand for natural gas in the U.S, as the absence of extreme temperatures curbs demand for heating and air conditioning.
Front-month sank 4.1 cents, or around 1.5%, to $2.652 per million British thermal units (btu) by 9:15AM ET (1315GMT).
The commodity ended lower on Monday, after weather forecasts showed that temperatures won’t be as cold as previously expected.
Market experts warned that futures are likely to remain vulnerable in the near-term as below-normal temperatures in April mean less than they do in January and February.
Meanwhile, market participants looked ahead to this week’s storage data due on Thursday, which is expected to show a draw in a range between 8 and 20 billion cubic feet (bcf) in the week ended April 6.
That compares with a decline of 29 bcf in the preceding week, an increase of 10 bcf a year earlier and a five-year average rise of 9 bcf.
Total natural gas in storage currently stands at 1.354 trillion cubic feet (tcf), according to the U.S. Energy Information Administration.
That figure is 697 bcf, or around 34%, lower than levels at this time a year ago, and 347 bcf, or roughly 20.4%, below the five-year average for this time of year.
Record high domestic production levels have overshadowed the fact that stocks in storage are well below their seasonal averages for this time of year.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Source: Investing.com
