Natural gas futures continued to decline during midday trade in Europe today. Cooler weather over parts of the US drove the blue fuel down, as power demand outlook was lowered. Experts suggest another massive injection for US gas inventories will be reported this week.
Front month natural gas futures, due in July, dropped 0.65% at the New York Mercantile Exchange to trade for $4.615 per million British thermal units at 12:43 GMT. Prices ranged from $4.602 to $4.636 per mBtu. Yesterday the contract dropped 1.38%, though it did reach a monthly high at $4.743 per mBtu, after last week blue fuel futures gained more than 3.5%.
“It’s a cooler pattern emerging of very little cooling demand in the midcontinent,” Teri Viswanath, director of commodities strategy at BNP Paribas SA in New York, said for Bloomberg. “A broad swath of the U.S. is going to have very light demand this week and possibly into next week.”
U.S. inventories probably expanded by 114 billion cubic feet last week, Tim Evans, energy analyst at Citi Futures in New York, wrote in note to clients today, cited by Bloomberg. The official government report is due on Thursday.
Previously, last weeks log revealed a 119 billion cubic feet (bcf), beating expectations of 116 bcf increase. The injection is the biggest stockpiles had received since June 2009. Stockpiles levels remain 33% below the reading from the previous year, but gradually recover.
US weather report
According to AccuWeather.com, New York will be cloudy, though warm today, with readings between 65 and 75 degrees Fahrenheit, which is normal for the season. There might be some thunderstorms, accompanied by showers. Through to Thursday temps will be slightly lower, before a nice warm up on Friday and into the weekend. However, clouds and rains will continue throughout the whole week. Up North on the East Coast, Boston is also set for a moderately warm day, though mostly cloudy and with a couple of showers. Temperatures will be normal, ranging 60-75. The next two days will be quite cooler, with highs in the mid 60s, before on Friday readings normalize again. Clouds and rains, with a few thunderstorms, will remain present this whole week.
Chicago will be cool and cloudy over the following days, with a strong possibility of thunderstorms and heavy rains today and on Wednesday. Temperatures will reach no higher than 70 degrees, 10 below normal. Starting on Thursday, the clouds will clear and it will be mostly sunny, though still cooler than normal.
Over on the West Cost, Los Angeles will be sunny today, with normal temperatures between 60 and 78 degrees Fahrenheit. Starting tomorrow, readings will slightly drop, but days will still be mostly sunny through this week. Up North, Seattle will see seasonal weather today, with temperatures 50-68, mostly cloudy. Tomorrow will be warmer, with highs in the mid 70s, before on Thursday readings start dropping again.
Technical view
According to Binary Tribune’s daily analysis, in case natural gas for settlement in July penetrates the first resistance level at $4.715 per million British thermal units, it will encounter next resistance at $4.786. If breached, upside movement will probably attempt to advance to $4.828 per mBtu.
If the energy source drops below its first resistance level at $4.602 per mBtu, it will see support at $4.560. If the second key support zone is breached, the power-station fuel’s downward movement may extend to $4.489 per mBtu.
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