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Natural gas futures re-approach 6-month low on weather outlook

Published 07/15/2014, 10:48 AM
Updated 07/15/2014, 10:48 AM
Natural gas futures trade near 6-month low on mild summer weather forecasts

Investing.com - Natural gas futures traded near a six-month low on Tuesday, as cooler than expected summer weather was expected to limit demand for the fuel.

On the New York Mercantile Exchange, natural gas for delivery in August hit a session low of $4.113 per million British thermal units, before coming off the lows to last trade at $4.133 during U.S. morning hours, down 0.35%, or 1.5 cents.

Natural gas futures fell to $4.092 on Monday, the weakest level since January 10, before settling at $4.147, up 0.02%, or 0.1 cents.

Futures were likely to find support at $4.092 per million British thermal units, the low from July 14 and resistance at $4.193, the high from July 10.

Updated weather-forecasting models called for cooler temperatures across most parts of the heavily-populated Midwest and Northeast regions over the next five days.

Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use.

Meanwhile, concerns over tight supplies continued to fade away after weekly supply data released last week showed that utilities in the U.S. added 93 billion cubic feet of gas into storage in the week ended July 4.

The five-year average change for the week is an increase of 72 billion cubic feet.

Total U.S. natural gas storage stood at 2.022 trillion cubic feet as of last week, 24.4% below their level this time last year and 27.5% below the five-year average.

Elsewhere on the Nymex, crude oil for delivery in August tumbled 1.4%, or $1.42, to trade at $99.50 a barrel, while heating oil for August delivery dropped 1.09% to trade at $2.841 per gallon.

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