Natural gas futures bounce off 2-week low to climb above USD4-level

Investing.com - Natural gas futures advanced for the first time in five sessions on Monday, as investors returned to the market to seek cheap valuations after prices fell to a two-week low.

On the New York Mercantile Exchange, natural gas futures for delivery in July traded at USD4.016 per million British thermal units during U.S. morning trade, up 0.8% on the day.       

It earlier fell by as much as 0.8% to hit a session low of USD3.952 per million British thermal units, the weakest level since May 17.

Natural gas prices plunged nearly 7% last week as sentiment on the fuel was dampened amid an uncertain demand outlook.

Weather forecasting models continued to point to above-normal temperatures across most of the U.S. over the next five days, before giving way to below-normal temperatures later in June.

Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning.  

U.S. supply levels also remained in focus. The U.S. Energy Information Administration said last week that natural gas storage in the U.S. rose by 88 billion cubic feet.

Inventories rose by 72 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a rise of 92 billion cubic feet.

Total U.S. natural gas storage stood at 2.141 trillion cubic feet as of last week, 4% below the five-year average for this time of year.

Early injection estimates for this week’s storage data range from 78 billion cubic feet to 95 billion cubic feet, compared to a 63 billion cubic feet increase during the same week a year earlier.

The five-year average for the week is a build of 92 billion cubic feet.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July rallied 1.2% to trade at USD93.06 a barrel, while heating oil for July delivery jumped 2% to trade at USD2.836 per gallon.