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Forumer storico
NEW YORK (Dow Jones)--Natural-gas futures fell Wednesday as traders bet demand for the fuel would moderate with mild weather in the coming weeks and steep losses in crude oil weighed on market sentiment.
Natural gas for June delivery settled 6.5 cents, or 1.5%, lower, at $4.181 per million British thermal units on the New York Mercantile Exchange.
The benchmark contract neared Monday's three-week lows midday as oil prices dove after a report of a larger-than-expected increase in gasoline stockpiles, but recovered some of those losses later in the session.
The gasoline supply report added to fears that businesses and consumers were cutting back on fuel usage in the face of higher prices. Natural-gas demand could also fall if strained budgets result in lower usage of electricity and cooling this summer or stall the recovery in industrial users' gas demand.
"You reach a threshold in the oil market where you get around a 3% price decline, and the natural gas is going to follow," said Jim Ritterbusch, head of Ritterbusch and Associates, which advises on energy trading.
Traders have few indicators for the next few weeks on what gas usage will look like over the high-demand summer months, leaving prices in a narrow range between roughly $4/MMBtu and $4.50/MMbtu.
"A month down the road, we can talk about hurricanes and high temperatures, but right now it's kind of a listless trade compared to other areas in the commodities space," Ritterbusch said.
Forecasts calling for mild weather across the U.S. are offering traders an opportunity to gauge whether the price plunge last week that bruised all commodities has pushed natural gas into a more comfortable range. Demand for the heating and power-plant fuel typically sinks during this time of year, as colder parts of the country see milder temperatures and southern areas haven't yet seen a consistent need to cool homes and businesses.
Meanwhile, some traders are looking ahead to an Energy Information Administration report expected to show that U.S. inventories increased by less than average last week as outages at nuclear power plants increased gas demand from the power sector. Analysts and traders surveyed by Dow Jones Newswires expect the EIA to say 70 billion cubic feet of gas was added to storage last week, short of the five-year average build on the week of 90 bcf.
The EIA said Tuesday that although gas in storage sits well below last year's levels, it expects high production and summer weather more mild than last year's to push inventories toward an all-time high of 3.9 trillion cubic feet by the end of October.
Domestic supplies reached a record high of 3.84 trillion cubic feet last November.
Natural gas for June delivery settled 6.5 cents, or 1.5%, lower, at $4.181 per million British thermal units on the New York Mercantile Exchange.
The benchmark contract neared Monday's three-week lows midday as oil prices dove after a report of a larger-than-expected increase in gasoline stockpiles, but recovered some of those losses later in the session.
The gasoline supply report added to fears that businesses and consumers were cutting back on fuel usage in the face of higher prices. Natural-gas demand could also fall if strained budgets result in lower usage of electricity and cooling this summer or stall the recovery in industrial users' gas demand.
"You reach a threshold in the oil market where you get around a 3% price decline, and the natural gas is going to follow," said Jim Ritterbusch, head of Ritterbusch and Associates, which advises on energy trading.
Traders have few indicators for the next few weeks on what gas usage will look like over the high-demand summer months, leaving prices in a narrow range between roughly $4/MMBtu and $4.50/MMbtu.
"A month down the road, we can talk about hurricanes and high temperatures, but right now it's kind of a listless trade compared to other areas in the commodities space," Ritterbusch said.
Forecasts calling for mild weather across the U.S. are offering traders an opportunity to gauge whether the price plunge last week that bruised all commodities has pushed natural gas into a more comfortable range. Demand for the heating and power-plant fuel typically sinks during this time of year, as colder parts of the country see milder temperatures and southern areas haven't yet seen a consistent need to cool homes and businesses.
Meanwhile, some traders are looking ahead to an Energy Information Administration report expected to show that U.S. inventories increased by less than average last week as outages at nuclear power plants increased gas demand from the power sector. Analysts and traders surveyed by Dow Jones Newswires expect the EIA to say 70 billion cubic feet of gas was added to storage last week, short of the five-year average build on the week of 90 bcf.
The EIA said Tuesday that although gas in storage sits well below last year's levels, it expects high production and summer weather more mild than last year's to push inventories toward an all-time high of 3.9 trillion cubic feet by the end of October.
Domestic supplies reached a record high of 3.84 trillion cubic feet last November.