Dow Jones - Natural Gas Falls Ahead Of Inventory Data

DJ Natural Gas Falls Ahead of Inventory Data



  By Carolyn Cui


  Natural-gas futures fell Thursday ahead of weekly inventory data, as traders think a withdrawal that matches the
historical average wouldn't resolve the glut in storage.

  Futures for February delivery were recently down 3% at $2.201 a million British thermal units on the New York
Mercantile Exchange.

  Mild temperatures in late 2015 kept demand for natural gas subdued, weighing on prices and pushing inventories well
above the average levels. Cold weather boosts demand for natural gas, which is used as the primary heating fuel in half
of the U.S. households.

  Colder temperatures in recent weeks have increased natural-gas consumption. Analysts and traders surveyed by The Wall
Street Journal expect the U.S. Energy Information Administration to report at 10:30 a.m. that stockpiles fell 175
billion cubic feet in the week ended Jan. 8.

  A withdrawal of this magnitude would be the largest of this heating season, but it would still be less than the 220
billion reported at this time last year, but in line with the 178 billion five-year average, according to EIA data.

  Average temperatures in the Northeast, Southeast and Midwest were down 16 degrees, 19 degrees and 5 degrees
Fahrenheit, respectively, compared with the previous week, driving up the demand. But "in contrast, warming in the
remainder of the cell regions sent average daily demand estimates almost 800 MMcf/d lower," said Mitch DeRubis, a
quantitative-modeling analyst with Platts Bentek, an analytics and forecasting unit of Platts, a provider of energy and
commodities information.

  The market is expected to remain oversupplied through the rest of the winter. If the storage estimate is correct,
inventories as of Jan. 8 totaled 3.6 trillion cubic feet, 24% above levels from a year ago and 19% above the five-year
average for the same week.


  Write to Carolyn Cui at carolyn.cui@wsj.com


  (END) Dow Jones Newswires

  January 14, 2016 10:16 ET (15:16 GMT)

  Copyright (c) 2016 Dow Jones & Company, Inc.

011416 15:16 -- GMT
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