Investing.com – Natural gas futures inched higher on Tuesday, adding to gains from the previous session, as updated forecasting models pointed to above-average temperatures covering most of the country through mid-May.
That should help boost early summer cooling demand for the fuel.
Front-month tacked on 0.6 cents, or around 0.2%, to $2.747 per million British thermal units (btu) by 10:15AM ET (1415GMT), after ending up 3.0 cents, or 1.1%, in the last session.
Gains were limited 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.
Meanwhile, market participants looked ahead to this week’s storage data due on Thursday. Analysts forecast an increase in a range between 83 and 95 billion cubic feet (bcf) for the week ended May 4.
That compares with a build of 62 bcf in the preceding week, an increase of 45 bcf a year earlier and a five-year average rise of 75 bcf.
Total natural gas in storage currently stands at 1.343 trillion cubic feet (tcf), according to the U.S. Energy Information Administration.
That figure is 903 bcf, or around 40.2%, lower than levels at this time a year ago, and 534 bcf, or roughly 28.4%, 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
