U.S. natural gas futures were lower on Thursday, albeit off the worst levels of the session after data showed that supplies in storage in the U.S. rose broadly in line with market expectations last week.
U.S. natural gas for June delivery shed 1.7 cents, or around 0.5%, to $3.254 per million British thermal units by 10:35AM ET (14:35GMT). Futures were at around $3.219 prior to the release of the supply data.
Prices of the heating fuel soared 10.6 cents on Wednesday, as traders reacted to cooler weather forecasts in the Midwest region.
The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. rose by 74 billion cubic feet in the week ended April 21, compared to forecasts for a build of 72 billion.
That compared with a gain of 54 billion cubic feet in the preceding week, an increase of 73 billion a year earlier and a five-year average rise of 57 billion cubic feet.
Total natural gas in storage currently stands at 2.189 trillion cubic feet, according to the U.S. Energy Information Administration, 14.0% lower than levels at this time a year ago but 13.7% above the five-year average for this time of year.
Meanwhile, weather systems will sweep across the Great Lakes and Northeast with showers and slightly cool temperatures through the end of the month.
High pressure is expected to dominate the western and southern US with warmer than normal conditions during the period.
Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on spring demand.
Gas use typically hits a seasonal low with spring\’s mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
Nearly 50% of all U.S. households use gas for heating[:]