US natural gas futures gained 2 percent on Tuesday on forecasts calling for slightly cooler weather over the next two weeks and expectations for another big storage draw. After falling almost 5.7 percent on Monday, front-month gas futures on the New York Mercantile Exchange closed up 5.4 cents at $2.732 per million British thermal units.
Some of the most active options were the $2 May and July 2015 and $1.75 June 2015 puts. On the Intercontinental Exchange, next-day gas in New York and New England fell to the lowest since December as the weather warmed. Thomson Reuters Analytics said the latest Global Forecast System model for the lower 48 US states showed the weather will cool slightly over the next two weeks with an expected 246 heating degree days. That compared with the 232-HDD forecast earlier Tuesday, the 250-HDD forecast on Monday and a 291-HDD 30-year norm for this time of year.
Consumption was expected to ease to 71.7 billion cubic feet per day on Wednesday, the least since December, from 72.6 bcfd on Tuesday. The norm for this time of year is 74.9 bcfd. Production in the lower 48 US states was expected to ease to 72.7 bcfd from 73.1 bcfd on Monday. That compared with 67.3 bcfd a year ago and a record high of 74.5 bcfd in December.
Net imports from Canada were expected to rise to 5.8 bcfd from 5.7 bcfd on Monday. Exports to Mexico, meanwhile, were expected to rise to 1.8 bcfd from 1.7 bcfd on Monday. Imports from US liquefied natural gas terminals were expected to hold at 0.3 bcfd, the same as Monday, with most gas coming from Elba in Georgia.
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