NEW YORK: US natural gas futures fell on Friday, as traders took profits after prices rose to a two-month high early, supported by higher demand forecasts and a drop in output in recent days due to Hurricane Francine.
Front-month gas futures for October delivery on the New York Mercantile Exchange fell by 5.2 cents, or about 2.2%, to settle at $2.305 per million British thermal units (mmBtu).
“It looks like there was some profit taking, we had a pretty decent rally this week and especially with the tightness in market expectations, smaller injection that we saw from the storage report yesterday, I think that created some side interest and I think that what we saw here ahead of the weekend was people just taking off some risk,” said Robert DiDona of Energy Ventures Analysis.
During the session, the contract hit its highest level since July 8. For the week, it was up 1%, the third consecutive weekly gain.
“It’s all about the storage scrapes that’s driving the market right now. So we have a lot of things that we can focus on and say maybe it’s low production, high exports to Mexico and increasing demand for power burns. But the reality is less gas is going into the ground towards the end of the storage injection season,” DiDona said.
The US Energy Information Administration (EIA) said utilities added 40 billion cubic feet (bcf) of gas into storage during the week ended Sept. 6.
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