US natural gas futures rose nearly 2 percent on Friday, lifted for a third straight session to a 3-1/2-month spot chart high as a string of supportive storage reports and forecasts for more cold weather in consuming regions lent support. Above-average nuclear power plant outages and recent talk of increased natural gas exports to Mexico also helped keep momentum to the upside, traders said.
Most agreed the chart picture remained supportive, after the nearby contract broke through several key resistance levels on its 24-percent run up in the last month. But some cautioned that the impending end of winter could provide resistance to higher prices. "The natural gas market extended recent gains with apparent ease as the temperature outlook trended cooler again. As we've been noting, however, the market is in full weather-driven mode here and is only as strong as the underlying forecast, and will see a downside test once the weather pattern changes," said Citi Futures energy specialist Tim Evans.
Front-month April natural gas futures on the New York Mercantile Exchange rose 6 cents, or 1.6 percent, to settle at $3.872 per million British thermal units. The contract rose as high as $3.924, the highest mark for a spot contract since late November, according to Reuters data. It is up 7 percent this week, and 24-percent from the five-week low of $3.125 touched in mid-February. In the cash market, gas for weekend delivery at the NYMEX benchmark Henry Hub in Louisiana rose 15 cents to $3.89, its highest average in 17 months.