US natural gas futures ended lower on Friday for a fourth straight day, pressured by follow-through selling after Thursday's slide and slightly more moderate weather forecasts for next week that could slow demand. Gas prices, which hit a 7-1/2-month high of $3.277 per mmBtu early this week and spiked 14 percent in July, sold off 8 percent on Thursday as milder forecasts and bearish weekly inventory data drove front-month futures to their biggest one-day slide in three years.
"I haven't been surprised by this pullback. We've seen some moderation on the weather front, and the Northeast is not looking as warm as people expected," a New York analyst said. Front-month gas futures on the New York Mercantile Exchange ended down 4.3 cents, or 1.5 percent, at $2.877 per million British thermal units after trading between $2.84 and $2.955. The near contract has lost 10.5 percent in the last four sessions, its biggest four-day drop in more than two months.
Traders said rising tropical activity may have helped limit the downside on Friday, noting that the peak of the storm season - late August and September - was still ahead. Traders on Friday were closely watching Tropical Storm Ernesto in the eastern Caribbean. The system is expected to strengthen into a hurricane by Monday. Early computer runs show it steering into the Gulf of Mexico. Gas prices hit decade-lows below $2 this spring but had rebounded by about 65 percent as record heat this summer and increased demand from utilities switching from coal to cheaper gas to generate power tightened the supply/demand balance.
Comments
Comments are closed.