Natural gas futures erased their gains on Thursday and traded flat following a slightly smaller-than-expected build in domestic inventories. Natural gas prices are still on track for a weekly gain and have been gradually chipping away at their year-to-date losses. Is there more room for growth for the so-called bridge fuel?
November natural gas futures were unchanged at $3.376 per million British thermal units (Btu) at 14:52 GMT on Thursday on the New York Mercantile Exchange. Natural gas prices are poised for a weekly gain of at least 5%, paring their year-to-date decline to below 18%.
According to the US Energy Information Administration (EIA), domestic supplies of natural gas rose 84 billion cubic feet for the week ending October 6, down from the previous week’s build of 86 billion cubic feet. This also came in below the consensus estimate of 88 billion cubic feet.
In total, US stockpiles stand at 3.529 trillion cubic feet, up 316 billion cubic feet from the same time a year ago. They are also 163 billion cubic feet above the five-year average of 3.366 trillion cubic feet.
Investors are also combing through the specifics of the report that showed zero build in the Pacific. South Central recorded its fourth consecutive weekly increase after two straight weeks of drawdowns.
Natural gas prices have found support on two short- and long-term factors.
First, cold weather is beginning to seep into the US, potentially bolstering heating demand days. In addition, forecasts point to cold and snowy weather in many key parts of the US this winter.
Second, the EIA published a report this week that said US natural gas exports will continue increasing until 2050 as global energy demand surges.
In other energy commodities, toward the end of the trading week, November West Texas Intermediate (WTI) crude oil futures rose $1.23, or 1.47%, to $84.73 a barrel. November Brent crude futures surged $1.41, or 1.64%, to $87.23 per barrel. November gasoline futures shed $0.0107, or 0.48%, to $2.1994 per gallon. November heating oil futures advanced $0.0477, or 1.59%, to $3.047 a gallon.