A government report tomorrow will probably show a below-normal decline in U.S. gas stockpiles as unusually mild weather east of the Rocky Mountains crimped demand for the furnace fuel, analyst estimates compiled by Bloomberg (DOENUSCH) show.
Inventories dropped 91 billion cubic feet, or 3.6 percent, to 2.504 trillion cubic feet in the week ended Feb. 24, based on the median of 15 estimates. The five-year average decline for the week is 118 billion, according to the Energy Department, which is scheduled to release the weekly report at 10:30 a.m.
Stockpiles (DOENT5YP)in the week ended Feb. 17 were 40 percent above the five-year average, last week’s report showed.
“The cold will not get cold enough to burn much gas while the warmer winter weather will kill any need to burn gas at all,” Peter Beutel, the president of Cameronhanover.com in New Canaan, Connecticut, said in a note to clients today.
The stockpile estimates ranged from declines of 74 billion to 93 billion cubic feet. About 51 percent of U.S. households use gas for heating, according to the Energy Department.
Demand for heat in the U.S. was 19 percent below normal in the week ended Feb. 25, according to Belton, Missouri-based forecaster Weather Derivatives.
Natural gas for next-month delivery fell 13.4 cents, or 5 percent, to $2.55 per million British thermal units last week on the New York Mercantile Exchange. The April contract rose 3.3 cents, or 1.3 percent, to $2.552 at 12:22 p.m. today. Prices have dropped 15 percent this year.
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