On Tuesday, U.S. natural gas futures declined, pulling back from previous session’s two week peak as traders continued to observe shifting weather forecasts to measure demand for the fuel.
U.S. natural gas for April delivery shed 5.3 cents, or approximately 1.8% to $2.848 per million British thermal units by 10:10AM ET (15:10GMT), after reaching $2.952 on Monday, the most since February 16.
Weather forecasts for the next 8 to 15 days indicated that the rain, snow, and cool temperatures will track across the northern and eastern U.S., increasing demand expectations for the heating fuel.
At the same time, the southern half of the U.S. will be warmer than usual as high pressure dominates with highs reaching the 60s to 80s Fahrenheit.
Meanwhile, market participants looked ahead to weekly storage data scheduled on Thursday, which is anticipated to indicate a draw in a range between 53 and 64 billion cubic feet in the week ended March 3.
Which compares with a build of 7 billion cubic feet in the preceding week, a decrease of 57 billion a year earlier and a five-year average decline of 136 billion cubic feet.
According to the U.S. Energy Information Administration Total natural gas in storage currently stands at 2.363 trillion cubic feet, 7.3% lesser than levels at this time a year ago and 12.5% above the five-year average for this time of year.
The costs of the heating fuel are down approximately 22% so far this year as predictions for warm winter weather influenced on heating demand expectations.
According to the data from the National Oceanographic and Atmospheric Administration, this year’s extremely warm winter has pushed heating demand for natural gas to approximately 20% below average.
Approximately half of U.S. homes use natural gas for heating.
Without important demand for natural gas, inventories could stay close to record levels and may even continue to drag prices even lower.
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