U.S. natural gas futures fall
Natural gas futures fell sharply on Monday, as traders monitored shifting weather forecasts to assess the outlook for spring demand and supply levels.
Natural gas for June delivery slumped 9.4 cents, or around 3%, to $3.172 per million British thermal units by 9:20AM ET (13:20GMT). Prices of the heating fuel jumped 8.0 cents on Friday.
Updated weather forecasting models pointed to a relatively cool period expected over the eastern U.S. for the next ten days, but still with warmer conditions gaining ground after, according to forecasters at NatGasWeather.com.
Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on spring demand.
Gas use typically hits a seasonal low with spring’s mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
Nearly 50% of all U.S. households use gas for heating.
Meanwhile, market participants looked ahead to weekly storage data due on Thursday, which is expected to show a build in a range between 48 and 58 billion cubic feet in the week ended May 5.
That compares with a gain of 67 billion cubic feet in the preceding week, an increase of 68 billion a year earlier and a five-year average rise of 73 billion cubic feet.
Total natural gas in storage currently stands at 2.256 trillion cubic feet, according to the U.S. Energy Information Administration, 13.7% lower than levels at this time a year ago but 13.4% above the five-year average for this time of year.