Natural gas turns lower after EIA inventory data
BY SARAH JACOB
NEW YORK -- Natural gas futures turned slightly lower Thursday, though a weekly government report showed that U.S. gas stockpiles increased less than expected.
Natural gas for August delivery recently fell 2 cents, or 0.5%, to $3.678/MMBtu on the New York Mercantile Exchange.
While analysts said the data was constructive, they said traders were instead looking beyond as there was not enough heat in the weather forecasts to push prices higher.
The U.S. Energy Information Administration said gas stockpiles last week rose by 41 Bcf. The build came in lower than the 47-Bcf injection forecast by a Dow Jones survey of analysts. The injection pace is above last year' s 26-Bcf injection, but below the five-year average build of 53 Bcf.
While a heat wave last week increased utilities' demand for gas-fired electricity, as businesses and homes increased air conditioning use, market watchers did not expect these temperatures to continue.
The Commodity Weather Group forecast below-normal conditions over the next one to five days across the Northeast and Midwest, key gas-consuming regions.
"Traders are looking ahead at mild temperatures through August 8 in the Northeast and Midwest," said Aaron Calder, market analyst at Gelber & Associates.
Meanwhile, traders were also keeping an eye on Tropical Storm Dorian, which was slowly making its way across the Atlantic Ocean. Forecasters say the storm appeared unlikely to hit the Gulf of Mexico production area and instead make its way toward the East Coast. The National Hurricane Center said the storm could reach Puerto Rico by early Tuesday.
Natural gas for next-day delivery at the benchmark Henry Hub in Louisiana recently traded at $3.685/MMBtu, according to IntercontinentalExchange, compared with Wednesday' s average of $3.6976/MMBtu. Natural gas for next-day delivery at Transcontinental Zone 6 in New York traded at $3.64/MMBtu, down from $3.7529/MMBtu.
Dow Jones Newswires