Dow Jones - Natural Gas Slips On Expecations of Early Supply Gains

DJ Natural Gas Slips on Expectations of Early Supply Gains

  By Christian Berthelsen

  Natural gas futures edged down Thursday ahead of weekly U.S. data expected to show an early-season increase in
natural gas supplies, thanks to robust production and weak demand at the end of a mild U.S. winter.

  Natural gas futures for April delivery were down 0.6% at $1.783 a million British thermal units on the New York
Mercantile Exchange. The market has retreated to two-week lows after an early start to spring drained the last
remaining hopes for gas-fired winter heating demand. The market lost 3.7% on Wednesday.

  Natural gas inventories are usually still declining at this time of year, as the last remains of winter drive heat
demand in U.S. homes and offices. But the early spring this year has analysts predicting a 22 billion cubic-foot
increase in supplies, though inventories usually fall by an average of 24 billion cubic feet at this time of year.

  The data is scheduled to be released at 10:30 a.m. EDT. If estimates prove correct, U.S. supplies will have reached
2.5 trillion cubic feet, a near-record, and 52% above average for this time of year.

  Shifts in weather forecasts are usually a key driver for the market, but as winter shifts to spring in so-called
shoulder season they play less of a role. The U.S. outlook remained about steady on Thursday, with a warm-up over the
eastern seaboard through the first days of April counter-balanced by a plunge below normal later into the month.

  "Production will need to see some accelerated decline if this market is to balance anytime soon," research
consultancy Ritterbusch and Associates said in a note.

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

  (END) Dow Jones Newswires

  March 24, 2016 10:08 ET (14:08 GMT)

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

032416 14:08 -- GMT
------