Natural gas futures extend gains after bullish weekly storage data
Investing.com - U.S. natural gas futures extended gains in North America trade on Thursday, after data showed that natural gas supplies in storage in the U.S. rose less than expected last week.
Natural gas for delivery in August on the New York Mercantile Exchange jumped 4.4 cent, or 1.58%, to trade at $2.830 per million British thermal units by 14:33GMT, or 10:33AM ET. Prices were at around $2.810 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. in the week ended July 1 rose by 39 billion cubic feet, below forecasts for an increase of 43 billion.
That compared with builds of 37 billion cubic feet in the prior week, 87 billion a year earlier and a five-year average of 77 billion cubic feet.
Total U.S. natural gas storage stood at 3.179 trillion cubic feet, 16.9% higher than levels at this time a year ago and 18.8% above the five-year average for this time of year.
Meanwhile, updated weather forecasting models showed that temperatures may be mostly normal in the lower 48 states from July 15 through July 19.
Prices are up nearly 50% since late May as expectations have grown that hot summer weather will lead to heavy demand.
Gas futures jumped to $2.998 last week, the highest since May 2015, as hot summer temperatures across most parts of the U.S. raised expectations for power generation demand to meet air conditioning needs.
A rally for natural gas this time of year isn't unusual. 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.
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