Investing.com - Natural gas futures rallied sharply on Monday, with the front-month contract hitting the highest level since December 2008, before turning lower as investors locked in gains.
On the New York Mercantile Exchange, natural gas futures for delivery in March rose to a session high of $6.493 per million British thermal units, the most since December 2008.
Nymex March gas prices last traded at $6.011 per million British thermal units during U.S. morning hours, down 2%. The March contract settled 1.17% higher on Friday to end at $6.135 per million British thermal units.
Meanwhile, natural gas futures for delivery in April shed 0.45% to trade at $4.990 per million British thermal units.
Natural gas futures were likely to find support at $4.844 per million British thermal units, the low from February 13 and resistance at $6.493, the high from February 24.
Natural gas prices surged earlier in the session after weather-service provider AccuWeather said that frigid arctic air will return to the U.S. Northeast and Midwest this week.
The U.S. National Weather service also said that a blast of freezing air is forecast for the central and eastern U.S. this week, as two storms threaten to bring snow to the Northeast.
Nymex natural gas prices rallied 15% last week, the second consecutive weekly gain, as frigid winter temperatures in the U.S. led households to burn a higher than normal amount of the fuel in furnaces to heat their homes.
Total U.S. natural gas storage stood at 1.443 trillion cubic feet as of last week, the lowest for this time of year since 2004.
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.
Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers increased their bullish bets in natural gas futures in the week ending February 18.
Net longs totaled 173,214 contracts, up 5.35% from net longs of 163,943 in the previous week.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in April rose 0.2% to trade at $102.38 a barrel, while heating oil for April delivery added 0.3% to trade at $3.047 per gallon.