Natural gas futures in New York advanced, heading for the first weekly gain since November, as forecasters predicted below-normal temperatures that would increase heating demand.
Gas climbed as much as 1.2 percent after Commodity Weather Group LLC in Bethesda, Maryland, said colder-than-average weather may spread across most of the contiguous U.S. from Dec. 26 through Jan. 4. The low in Chicago on Jan. 2 may be 8 degrees Fahrenheit (minus 13 Celsius), 11 lower than usual, according to AccuWeather Inc.
“The winter weather’s making a little bit of a comeback and prices are responding,” said Tom Saal, senior vice president of energy trading at INTL Hencorp Futures LLC in Miami. “The market is going to be grinding higher again for as long as these forecasts continue.”
Natural gas for January delivery rose 2.3 cents, or 0.7 percent, to $3.485 per million British thermal units at 9:08 a.m. on the New York Mercantile Exchange. The futures are up 17 percent this year, heading for the first annual gain since 2007. Prices have gained 5.2 percent this week, approaching the first weekly increase since Nov. 23.
Gas declined to $3.261 per million Btu in intraday trading on Dec. 14, the lowest level since Sept. 28.
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