Investing.com - Natural gas futures rebounded on Monday after bottom fishers snapped up nicely-priced positions in the commodity and took back losses stemming from last week''s bearish supply report.
On the New York Mercantile Exchange, natural gas futures for delivery in August traded at $4.481 per million British thermal units during U.S. trading, up 1.62%. The commodity hit a session high of $4.493 and a low of $4.379.
The August contract settled down 0.72% on Friday to end at $4.409 per million British thermal units.
Natural gas futures were likely to find support at $4.375 per million British thermal units, Friday''s low, and resistance at $4.608, Thursday''s high.
The U.S. Energy Information Administration said in its weekly report on Thursday that natural gas storage in the U.S. in the week ended June 20 rose by 110 billion cubic feet, above forecasts for an increase of 102 billion cubic feet.
The five-year average build for the week is 81 billion.
Total U.S. natural gas storage stood at 1.829 trillion cubic feet. Stocks were 690 billion cubic feet less than last year at this time and 822 billion cubic feet below the five-year average of 2.651 trillion cubic feet for this time of year.
Natural gas stockpiles have grown by more than 100 billion cubic feet for seven consecutive weeks, a record streak since 1994.
Producers would need to add approximately 2.6 trillion cubic feet to storage by November 1 to meet typical winter demand, according to analysts.
The report sent prices falling for two consecutive sessions, though by Monday, markets felt the commodity had fallen too far, especially after updated weather forecasting models calls for rising temperatures in the coming days.
In its Monday morning update, Natgasweather.com called for very warm to hot temperatures during the second week of July, which should offset the effects that pockets of cooler air might have on trading.
"The weather system tracking out of the northern Plains will bring cooling temperatures over the coming days to the Midwest, and eventually the eastern U.S. later in the week. But it is still very warm to hot over the southern U.S. and West as temperatures warm into the 90s to 110s," Natgasweather.coin reported.
"Much of interior California will also experience temperatures 100-110F as well for the next several days. Even with the weather system over the northern U.S., accumulated population weighted Cooling Degree Days for week will come in above average."
Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in August were down 0.80% at $104.90 a barrel, while heating oil for August delivery were down 0.84% at $2.9783 per gallon.
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