On Tuesday, U.S. natural gas futures fell for the 4th session in a row, hitting a three-week low as predictions for less cold weather and lighter heating demand through the end of the year pulled down prices.
Delivery of Natural gas for January on the New York Mercantile Exchange dropped to a session low of $3.252 per million British thermal units, a level not met since November 28.
It was last at $3.256 by 10:00AM ET (15:00GMT), down 13.6 cents, or 4%.
Futures sold off after updated weather predicting models predicted warmer temperatures would come by the end of December, reducing demand for the heating fuel.
Approximately half of U.S. homes use natural gas for heating.
Temporarily, market players awaited weekly supply data scheduled on Thursday, which is anticipated to present a draw in a range between 197 and 210 billion cubic feet in the week ended December 16.
That compares with a withdrawal of 147 billion cubic feet in the preceding week, 32 billion a year before and a five-year average decline of 101 billion cubic feet.
“Total natural gas in storage lately stands at 3.806 trillion cubic feet, according to the U.S. Energy Information Administration, 1.3% lower than levels at this time a year ago and 4.9% above the five-year average for this time of year.”
On Additional News
On Wednesday, oil prices nudged higher on anticipations of a U.S. crude inventory draw, even though trading activity was muted as markets begin to wind down in advance of the Christmas weekend.
U.S. West Texas Intermediate (WTI) crude oil futures were trading at $53.58 per barrel at 0105 GMT, increase 28 cents from their previous settlement.
International Brent crude oil futures were at $55.57 a barrel, increase 22 cents.
Traders stated the higher prices were largely because of the expected reduction in U.S. crude oil inventories, which will be reported late on Wednesday.
Jeffrey Halley, analyst at futures OANDA in Singapore said U.S. crude stocks were anticipated to fall by 2.563 million barrels.
In the absence of strong fundamentals, traders stated that technical support and resistance levels would become price drivers.
“U.S. oil may rise to $54.37 per barrel, as it has broken resistance at $53.36,” said Reuters technical commodities analyst Wang Tao.
“Brent oil is poised to break a resistance at $55.79 per barrel,” he said.
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