Dow Jones - Natural Gas Reverses Losses As Canada Wildfires Spread

DJ Natural Gas Reverses Losses, Rises as Canada Wildfires Spread


  By Christian Berthelsen


  Natural gas prices shook off early declines Friday and rose in tandem with oil and other energy contracts as Canadian
wildfires spread, increasing estimates of lost production.

  Natural gas futures were down as much as 1.5% in early trading but rallied as reports said Canada's wildfires were
gaining ground, recently trading up 0.6% at $2.0880 a million British thermal units on the New York Mercantile
Exchange.

   Analysts were raising their estimates of Canadian oil production taken offline by the wildfires spreading in the
Alberta oil sands region, to as much as 1 million barrels a day. Though reports haven't yet said oil or gas facilities
have been damaged by the fires, oil workers have been evacuated and sites have been shut down as a precautionary
measure.

   Canada is the largest exporter of oil and natural gas to the U.S., sending in 3.6 million barrels of crude and more
than 240 billion cubic feet of gas per month, according to U.S. Energy Information Administration data.

     The fires reversed otherwise bearish forces in the market. New weather forecasts pulled back from prior
predictions of prolonged below-normal temperatures along the eastern U.S. seaboard into next week, and projected mild
spring weather heading into late May.

   With spring temperatures in so-called shoulder season providing little impetus for either heating or cooling demand,
expectations decline for natural-gas demand to power air conditioning or heat homes.

   The U.S. Energy Department said Thursday that nationwide domestic gas stockpiles grew 68 billion cubic feet last
week, slightly more than analysts expected and adding to end-of-winter storage levels that already were at a record
high after a tepid winter that limited heating demand. Stockpiles are now 2.625 trillion cubic feet, nearly 47% higher
than average for this time of year.


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


  (END) Dow Jones Newswires

  May 06, 2016 11:16 ET (15:16 GMT)

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

050616 15:16 -- GMT
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