Natural gas gains on forecasts for blast of wintry weather

Investing.com - Natural gas prices rose on Friday after updated weather forecasting models called for below-normal temperatures across much of the lower 48 states over the next seven to ten days, which included the possibility of powerful winter storm shooting up the Atlantic seaboard.

On the New York Mercantile Exchange, natural gas futures for delivery in December traded at USD3.774 per million British thermal units during U.S. trading, up 1.93%.

The commodity hit a session low of USD3.682 and a high of USD3.778.

The December contract settled up 0.76% at USD3.702 per million British thermal units on Thursday.

Futures were likely to find support at USD3.546 per million British thermal units, Tuesday's low, and resistance at USD3.787, the high from Oct. 27.

Natural gas prices rose after weather services called for a current cool snap to give way to a brief warming trend across parts of the southern U.S. before another blast of cold air sweeps across the country next week, which could drag a low pressure system up with it and create stormy conditions across the East Coast.

Colder temperatures hike the need for heating and thus increase demand for natural gas at the nation's thermal power generators.

A bullish supply report released on Thursday supported prices as well.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended Nov. 15 fell by 45 billion cubic feet, outpacing expectations for a withdrawal of 33 billion cubic feet.

Inventories fell by 36 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 2 billion cubic feet.

Total U.S. natural gas storage stood at 3.789 trillion cubic feet. Stocks were 89 billion cubic feet less than last year at this time and 15 billion cubic feet above the five-year average of 3.774 trillion cubic feet for this time of year.

The report showed that in the East Region, stocks were 118 billion cubic feet below the five-year average, following net withdrawals of 31 billion cubic feet.

Stocks in the Producing Region were 96 billion cubic feet above the five-year average of 1.188 billion cubic feet after a net withdrawal of 13 billion cubic feet.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in January were down 0.53% and trading at USD94.93 a barrel, while heating oil for December delivery were up 0.69% and trading at USD3.0273  per gallon.