BLBG: Natural Gas Climbs in New York on Forecasts of Below-Normal Temperatures
Natural gas futures climbed for a third day in New York on forecasts of below-normal temperatures in the eastern and central U.S.
Gas futures rose as colder-than-normal weather is expected in the eastern half of the U.S. through Dec. 18, according to WSI Corp. in Andover, Massachusetts. Heating demand from Dec. 9 through Dec. 13 may be 12 percent above normal levels, according to David Salmon, a meteorologist with Weather Derivatives in Belton, Missouri.
“The December forecasts are on par with last year, and last year was very, very cold,” said Teri Viswanath, a director of commodities research at Credit Suisse Securities USA in Houston. “This is the cheapest gas we’ve seen in several winters, so we could see a surprise to the upside.”
Natural gas for January delivery rose 3.4 cents, or 0.8 percent, to trade at $4.377 at 10:01 a.m. on the New York Mercantile Exchange. The futures have dropped 0.5 percent this week and 21 percent this year.
The low temperature in New York on Dec. 10 may be 28 degrees Fahrenheit (minus 2 Celsius), 5 degrees below normal, according to AccuWeather Inc. in State College, Pennsylvania. The low in Chicago may be 16 degrees, 8 below normal.
Inventories of the heating and power-plant fuel were 10 percent above the five-year average for the week ended Nov. 26. The surplus of gas in storage over the five-year average has risen in eight of the past 10 weeks.
Government Reports
The Energy Department reported yesterday that 23 billion cubic feet of gas were withdrawn from storage in the week ended Nov. 26, below the five-year average reduction of 36 billion. Stockpiles totaled 3.814 trillion cubic feet.
Employers added fewer jobs that forecast in November and the unemployment rate unexpectedly increased, Labor Department figures showed today in Washington. Payrolls increased 39,000, less than the most pessimistic projection of economists surveyed by Bloomberg News, after a revised 172,000 increase the prior month, the department said.
The jobless rate rose to 9.8 percent, the highest since April, while hours worked and earnings stagnated. Gas traders track economic data for signs of a recovery that could boost the demand for raw materials.
To contact the reporter on this story: Christine Buurma in New York at cbuurma1@bloomberg.net;
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
