Investing.com - Natural gas futures rallied more than 4% in early trade on Tuesday as a winter storm bringing fresh snowfalls through the Northeast fed expectations that demand for the home heating fuel would continue to rise.
On the New York Mercantile Exchange, natural gas futures for delivery in March rose to a session high of $5.558 per million British thermal units, the highest since February 5.
Nymex gas prices last traded at $5.457 per million British thermal units during U.S. morning hours, up 4.66%.
The March contract settled 0.17% lower on Friday at $5.214 per million British thermal units. U.S. energy markets were closed for the Presidents Day holiday on Monday.
Natural gas futures were likely to find support at USD4.818 per million British thermal units, the low from February 13 and resistance at USD5.734, the high from February 5.
The latest weather forecasts indicated that winter storm Rex was set to sweep over the U.S. Northeast on Tuesday, bringing strong winds and fresh falls of snow.
Nymex natural gas prices surged 8.41% last week, the first weekly gain in three weeks, as frigid winter temperatures in the U.S. led households to burn a higher than normal amount of the fuel to heat their homes.
The heating season from November through March is the peak demand period for U.S. gas consumption. Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.
Speculation that this week’s supply data will show a larger-than-average drawdown in supplies also lent support. Early withdrawal estimates range from 212 billion cubic feet to 240 billion cubic feet.
Total U.S. natural gas storage stood at 1.686 trillion cubic feet as of last week, the lowest for this time of year since 2004.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in April rose 1.07% to $101.21 a barrel, while heating oil for March delivery added 0.86% to trade at $3.1046 per gallon.
Jerusalem Post Annual Conference. Buy it now, Special offer. Come meet Israel's top leaders