BS: Natural Gas Futures Decline on Moderating Temperature Outlook
Jan. 7 (Bloomberg) -- Natural gas futures declined for a third day on speculation that the weather won’t be cold enough to trim a surplus of the heating fuel.
Gas fell as much as 1.5 percent as temperatures may be normal or above-normal in the Northeast through Jan. 21, according to Commodity Weather Group in Bethesda, Maryland. Supplies of gas as of Dec. 31 were 6.5 percent above the five- year average, the Energy Department said yesterday.
“There’s no shortage of gas, bottom line,” said Ed Kennedy, a trader at INTL Hencorp Futures in Miami. “The $4.60 to $4.70 range should be about it to the upside. We need a very cold February forecast to go higher than that.”
Natural gas for February delivery fell 4 cents, or 0.9 percent, to $4.394 per million British thermal units at 9:37 a.m. on the New York Mercantile Exchange. The futures are little changed this week.
The low temperature in New York on Jan. 16 may be 37 degrees Fahrenheit (3 Celsius), 11 degrees above normal, according to AccuWeather Inc. in State College, Pennsylvania. The low in Boston may be 33 degrees Fahrenheit, also 11 degrees above normal.
About 52 percent of U.S. households use natural gas for heating, according to the Energy Department.
The department reported yesterday that 135 billion cubic feet of gas were withdrawn from storage in the week ended Dec. 31, above the five-year average drop of 79 billion. Gas stockpiles totaled 3.097 trillion cubic feet, 1.5 percent below levels a year earlier.
Gas inventories may fall to 1.833 billion cubic feet by the end of the winter heating season on March 31, about 171 billion higher than the previous March, the Energy Department said Dec. 7 in its Short-Term Energy Outlook.
Employers in the U.S. added fewer jobs than forecast in December, the Labor Department reported today in Washington. Gas traders track economic data for signs of a recovery that would boost fuel demand.
Payrolls increased 103,000, compared with the median forecast of 150,000 in a Bloomberg News survey.
--With assistance from Bob Willis in Washington. Editors: Bill Banker, Richard Stubbe
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
