Investing.com - Bargain hunters snapped up nicely-priced natural gas futures on Friday after Thursday''s weekly supply report sent prices down to levels ripe for bottom fishing.
On the New York Mercantile Exchange, natural gas futures for delivery in June traded at $4.390 per million British thermal units during U.S. trading, up 0.70%. The commodity hit session high of $4.404 and a low of $4.360.
The June contract settled down 2.55% on Thursday to end at $4.359 per million British thermal units.
Natural gas futures were likely to find support at $4.349 per million British thermal units, Thursday''s low, and resistance at $4.575 Wednesday''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 ending May 16 rose by 106 billion cubic feet, above forecasts for an increase of 102 billion cubic feet.
The five-year average change for the week is a build of 90 billion cubic feet, and prices dropped on teh news before rebounding after markets viewed the commodity as oversold.
Total U.S. natural gas storage stood at 1.266 trillion cubic feet. Stocks were 774 billion cubic feet less than last year at this time and 943 billion cubic feet below the five-year average of 2.209 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 449 billion cubic feet below the five-year average, following net injections of 65 billion cubic feet.
Stocks in the Producing Region were 379 billion cubic feet below the five-year average of 892 billion cubic feet after a net injection of 29 billion cubic feet.
Producers would need to add 2.6 trillion to 2.9 trillion cubic feet to storage by November 1 to meet typical winter demand, analysts said.
Meanwhile, updated weather forecasting models called for mild springtime temperatures over much of the country in the coming week, which was seen lowering demand for heating.
Natgasweather.com reported that high pressure will allow for pleasant weather over much of the U.S. even though several weather systems will track across the country, though they won''t be exceptionally cold.
High pressure will lead to warmer conditions over many regions and will drive modest cooling demand, especially over the southern U.S., natgasweather.com added.
Spring and fall see the weakest demand for natural gas in the U.S, as the absence of extreme temperatures curbs demand for heating and air conditioning.
Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July were up 0.61% at $104.37 a barrel, while heating oil for June delivery were up 0.07% at $2.9528 per gallon.
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