Forexpros –
Forexpros – Natural gas futures traded higher Wednesday, due to a large number of nuclear power plant outages in the U.S. and bottom fishing.

On the New York Mercantile Exchange, natural gas futures April settlement traded at USD2.58 per BTU during late U.S. trade, surging 2.84%.

The front-month April contract traded in a range between USD2.563 per million British thermal units, the daily high and USD2.503, the session low and the lowest since February 16.

Natural gas prices found support on news of late-season nuclear plant outages in the U.S., which could add more than 1 billion cubic feet to daily U.S. gas demand.

However future prices were expected to remained under pressure from weather forecasts indicating v mild weather across the U.S. throughout most of March.

The Commodity Weather Group said Tuesday that the U.S. Northeast and Ohio Valley-states were expected to become much warmer-than-normal by the second week of March, dampening demand for the heating fuel.

The above-average weather outlook comes after the CWG said last week that March was forecast to be 13.5% warmer than March of last year.

According to private forecaster MDA EarthSat, temperatures were expected to be 8 to 14 degrees Fahrenheit (4.4 to 7.8 Celsius) above normal from Ohio to New England from March 9 through March 13.

Meanwhile, natural gas traders were looking forward to Thursday’s closely-watched U.S. Energy Information Administration’s report on U.S. natural gas stockpiles for the week ended February 24 to gauge the strength of demand in the U.S.

The data could show a decline of 90 billion cubic feet, compared to last year’s drop of 85 billion cubic feet and the five-year average decline for the week of 118 billion.

Market participants noted that April is considered a transition month for natural gas. Futures contracts tend to trade more lightly during spring months because demand for heating is weak and natural gas-fueled power plants have yet to step up production to serve air conditioners.

Natural gas prices have lost almost 11% in the past five trading sessions, as traders focused on mild weather and bloated inventories.

Winter so far in the U.S. has been the second mildest since 1950. It is running about 13% warmer than the 30-year normal, according to recent data from MDA EarthSat.

Inventory withdrawals this winter are running nearly 510 billion cubic feet below average, or about 29%, due to the lack of heating demand this winter.

Last winter at this time, cold weather conditions led to a decline of more than 2 trillion cubic feet from U.S. storage to help meet the surge in heating demand. In contrast, only 1.3 trillion cubic feet of storage gas has been burned this winter season, a 37% drop.

Total U.S. natural gas storage stood at 2.595 trillion cubic feet as of last week, 41% above year-ago levels and 40% higher than the five-year average for this time of year.

Market analysts expect natural gas prices to retest January’s ten-year low of USD2.319 per million British thermal units, amid expectations U.S. gas inventories will end the winter at a record high 2.215 trillion cubic feet.

That’s 43% above the five-year average and well above the previous record of 2.148 trillion cubic feet set in 1983.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in April moved higher by 0.32% to trade at USD106.92 a barrel.

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