Forexpros – Natural gas futures were down sharply on Wednesday, trading at a two-day low as investors awaited the release of key data on U.S. natural gas inventories later in the day.
On the New York Mercantile Exchange, natural gas futures for delivery in December traded at USD3.362 per million British thermal units during U.S. morning trade, tumbling 1.55%.
It earlier fell by as much as 1.8% to trade at USD3.356 per million British thermal units, the lowest since November 21, when prices fell to a 13-month low.
Natural gas traders were looking forward to the U.S. Energy Information Administration’s weekly report on U.S. natural gas stockpiles for the week ended November 18 later in the day.
The report was expected to show that U.S. natural gas supplies rose by 17 billion cubic feet last week to a fresh record high of 3.867 trillion cubic feet.
The five-year average stockpile change for the week is a decline of 7 billion cubic feet, according to U.S. Energy Department data.
The report was being released a day earlier than usual due to the Thanksgiving Day holiday Thursday.
Since the beginning of November, natural gas futures have fallen nearly 14%, as mild weather in key gas-consuming regions in the U.S. and concerns over record-high inventory levels drove prices lower.
Historically, this is usually the week when the market flips from growing inventories to declining inventories, with winter weather driving up demand as people heat their homes.
However, the Commodity Weather Group said earlier that the U.S. Northeast may remain warmer than normal through the first week of December, which could potentially limit heating demand.
According to the group’s 6-to-10-day weather outlook, the Northeast, including most of New York, was forecast to be nearly 3 degrees Fahrenheit (1.6 Celsius) warmer-than-normal from November 28 to December 2.
Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts for November on heating demand.
Elsewhere on the Nymex, light sweet crude oil futures for delivery in January tumbled 2.3% to trade at USD95.78 a barrel, while heating oil for December delivery dropped 1.7% to trade at USD2.983 per gallon.
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