Investing.com - Natural gas futures rallied for the fourth consecutive session on Wednesday, as market players looked ahead to Thursday’s closely-watched weekly supply data amid speculation it will show the largest drop on record.
On the New York Mercantile Exchange, natural gas futures for delivery in February traded at USD4.400 per million British thermal units during U.S. morning trade, up 0.7%.
Nymex February gas futures rallied by as much as 1% earlier in the day to hit a session high of USD4.414, the strongest level since January 7.
The February contract surged 2.22% on Tuesday to end at USD4.369 per million British thermal units. Natural gas futures were likely to find support at USD4.287 per million British thermal units, the low from January 14 and resistance at USD4.428, the high from January 7.
Early withdrawal estimates for this Thursday’s storage data range from 250 billion cubic feet to 339 billion cubic feet. The five-year average change for the week is a decline of 159 billion cubic feet.
The largest drop on record is a decrease of 285 billion cubic feet in the seven days ended December 13, Energy Information Administration data show.
Natural gas supplies fell by 157 billion cubic feet last week to hit 2.817 trillion cubic feet, approximately 16% below last year''s unusually high level and nearly 10% below the five-year average for this time of year.
Meanwhile, updated weather forecasting models called for colder-than-normal temperatures in the week ahead. MDA Weather Services forecast cold weather will move into the Eastern half of the country over the next six-to-ten days.
Forecasts originally called for moderating weather during the period.
Bullish speculators are betting that the cool weather will increase demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in March rose 0.45% to trade at USD93.19 a barrel, while heating oil for February delivery advanced 0.75% to trade at USD2.958 per gallon.
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