Dow Jones - Natural Gas Falls As Late Winter Cold Falls Short

DJ Natural Gas Falls as Late Winter Cold Falls Short



  By Christian Berthelsen


  Natural gas futures fell Monday after forecasts for cold temperatures on the eastern seaboard in recent days failed
to live up to expectations, raising doubts they would drive late-season gas-fired heating demand.

  Natural gas futures for April delivery were down 3.5% at $1.84 a million British thermal unit on the New York
Mercantile Exchange. Gas futures rallied nearly 8% so far this month in expectations that a blast of cold weather at
the end of an otherwise tepid winter could restore some demand, but are now fading as those hopes dim.

  Weak demand and booming production have led to a sizable oversupply in the natural gas market, with U.S. inventories
48% higher than average for this time of year. Some analysts believe this week's data will show an increase in
supplies, a rare occurrence for a winter week when cold temperatures usually prompt drawdowns to heat homes and
offices.

  "This market has begun the official beginning of spring under some modest downside price pressures," research
consultancy Ritterbusch and Associates said in a note.

  Though late-season cold is expected to persist into early April, much of it will likely fall in the Midwest, while
the key eastern seaboard demand area will likely see normal and even above-normal temperatures.

  In physical markets, cash prices for next-day delivery of natural gas at the benchmark Henry Hub in Louisiana last
traded at $1.7550 a million Btus, below Friday's range of $1.83-$1.86. Gas at the Transco Z6 hub in New York last
traded at $1.22 a million Btus, below Friday's range of $1.90-$2.00.


  Write to Christian Berthelsen at christian.berthelsen@wsj.com


  (END) Dow Jones Newswires

  March 21, 2016 10:27 ET (14:27 GMT)

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

032116 14:27 -- GMT
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