Fading Demand Sends Natural Gas Futures Lower for Third Dayby
Eastern U.S. weather may be mostly normal in early October
Gas stockpiles have been above five-year average since May
Forecasts for waning demand pushed natural gas futures lower for a third straight day.
Temperatures may be mostly normal in the eastern half of the U.S. from Oct. 4 through Oct. 13, according to WSI Corp. Gas stockpiles totaled 3.44 trillion cubic feet as of Sept. 18, 4.5 percent above the five-year average and 15.7 percent above the year-ago level.
“The forecasts are showing fairly neutral weather for the next couple of weeks,” said Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York. “We’re going to see some pretty big storage gains at this time of year, probably until the end of October.”
Natural gas for November delivery fell 8.4 cents, or 3.2 percent, to settle at $2.586 per million British thermal units on the New York Mercantile Exchange. Volume for all futures traded was 15 percent below the 100-day average at 2:54 p.m. Gas is down 10 percent this year and 3.8 percent this month.
The low temperature in Boston on Oct. 6 may be 50 degrees Fahrenheit (10 Celsius), matching the normal reading, and the high may be 66, AccuWeather Inc. data show. Power plants account for about 33 percent of gas demand, and 49 percent of U.S. households use the fuel for heating.
The U.S. lowered its estimate for average 2015 gas prices at the benchmark Henry Hub in Erath, Louisiana, to $2.84 per million Btu from $2.89, the U.S. Energy Information Administration said Sept. 9 in the monthly Short-Term Energy Outlook report. Production may climb 5.7 percent this year to average a record 78.95 billion cubic feet a day.