On Thursday, US natgas futures’ prices faltered more than 6 per cent following a forecast that said the United States would likely to witness a milder winter weather alongside an indentation in heating demand over Christmas and New Year holidays, while a US EIA (Energy Information Administration) report revealing a smaller-than-usual storage withdrawal last week had added to further strains on investors’ morale.
Nevertheless, although, US natgas futures scheduled to be expired by January had dipped as much as 6.2 per cent in the day’s commodity market closure as investors headed into the Christmas following a holiday-thinned trading week, the contract had wrapped up the week 1.1 per cent higher despite a broad-based Thursday retreat with demands reportedly having been spiked in the bloc amid a steep shortage earlier in the week.
However, in the day’s heavy shelling on US natgas futures’ prices, was almost entirely prompted by a Refinitiv forecast that the US would experience a milder-than-anticipated winter weather as beforementioned.
Fanning up the flames further, US EIA said in a report earlier in the day that it had drawn an approximated 55 billion cubic feet of gas from storage over the week that ended on December 17 compared to a withdrawal of 147 billion cubic feet registered at the same time a year earlier, illustrating a havoc-scale demand-crunch.
US front-month natgas futures faltered 6.2 per cent
Citing statisitcs, in the day’s commodity market wind-down, US natgas futures’ prices shed 6.2 per cent to $3.73 per mmBtu (million British thermal unit).
On a technical viewpoint, after having been teetered below a technical support level of $4 per mmBtu earlier in the month followed by a dour demand-forecast, US natgas futures’ prices had been failing to find a concrete psychological handle despite several concerted efforts.
Meanwhile, addressing to latest weather and demand forecasts, an analyst with data provider Refinitiv, John Abeln said, “I think weather and the demand forecast are the big factors weighing on the market. The end of December was already expected to be significantly warmer than usual, but forecasts keep shifting warmer”.