U.S. Natural Gas Gains for Second Day on Outlook for Hot WeatherChou Hui Hong
Natural gas gained a second day in New York on forecasts for hotter weather in late June that would spur demand from power plants.
Gas for July delivery rose as much as 0.8 percent to $3.907 per million British thermal units in electronic trading on the New York Mercantile Exchange, and was at $3.890 per million Btu at 1:33 p.m. Singapore time. The contract jumped 3.8 percent yesterday, the most in seven weeks, to $3.875.
The U.S. Northeast and parts of the Midwest may have above-normal temperatures from June 22 through June 28, according to Commodity Weather Group LLC in Bethesda, Maryland. The high in New York on June 25 may be 90 degrees Fahrenheit (32 Celsius), 8 more than usual, according to AccuWeather Inc. in State College, Pennsylvania.
The high in St. Louis on June 23 may be 92 degrees Fahrenheit, 5 more than usual, AccuWeather said.
“The market is taking its cues from the weather,” Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut, said yesterday. “We’re seeing a little heat, especially in the Midwest and Northeast.”
Gas prices at the benchmark Henry Hub in Erath, Louisiana, will average $3.92 per million Btu this year, up from the May estimate of $3.80, the Energy Information Administration, the Energy Department’s statistical arm, said in its June 11 Short-Term Energy Outlook. The average for the third quarter was raised 7.4 percent to $4.05 from $3.77.