US natural gas futures fall three percent on warmer weather

US natural gas futures fell more than 3 percent on Friday to the lowest level since early February on forecasts for warmer, but still a little below-normal, temperatures over the next two weeks.
Front-month gas futures on the New York Mercantile Exchange closed down 8.2 cents at $2.59 per million British thermal units.
May futures, meanwhile, lost a nickel to $2.64.
Some of the most active options early Friday were the $1.75 July 2015 puts and the $2 May, June, July and August 2015 puts.
Gas for calendar 2016 and 2017 both declined to the lowest on record, according to data going back to 2006, on expectations for record production from shale plays.
US gas rigs this week fell by nine to 233, the lowest on record, according to data going back to 1987 from oil services firm Baker Hughes.
Thomson Reuters Analytics said the latest Global Forecast System weather model for the lower 48 US states confirmed earlier forecasts for warmer, but still below normal, temperatures over the next two weeks.
Heating degree days a measure of population-weighted average temperatures, for the lower 48 states were expected to reach 237 over the next two weeks.
That compared with a forecast 235 HDD earlier Friday, 242 HDDs on Thursday and a 30-year norm of 220 for this time of year.
Consumption was expected to fall to 67.6 billion cubic feet per day on Monday from 78.4 bcfd on Friday. The norm for this time of year is 66.6 bcfd.
Thomson Reuters Analytics also said production was expected to hold at 73.6 bcfd, the same as Thursday. That compared with 68.3 bcfd a year ago and a record high of 74.4 bcfd in mid-February.
Net imports from Canada were expected to hold at 5.9 bcfd from, the same as Thursday, while exports to Mexico were expected to rise to 1.9 bcfd from 1.8 bcfd on Thursday.
In early estimates, analysts forecast utilities pulled 12 billion cubic feet of gas from storage during this week.
That compared with a build of 12 bcf last week, a draw of 71 bcf in the same week last year and a five-year average draw of 22 bcf. The US Energy Information Administration will release the storage report at 10:30 am EDT on Thursday.