Dow Jones Natural Gas - Morning Commentary

DJ Natural Gas Ticks Lower as Forecasts Shift


   By Nicole Friedman


  NEW YORK--Natural-gas prices slipped from near-one-month highs Thursday on slightly warmer weather forecasts, which
could ease demand for the heating fuel.

  Natural gas for April delivery recently traded down 4.6 cents, or 1.6%, to $2.874 a million British thermal units on
the New York Mercantile Exchange.

  Prices settled at their highest level since Feb. 20 on Wednesday as forecasts called for unseasonably cold weather in
the coming weeks, which could boost demand for natural gas to power indoor heating. About half of U.S. households use
natural gas as their primary heating fuel.

  But forecasts released Thursday were a bit more moderate. In the next six to 10 days, "today's forecast is generally
warmer or not as cold as the previous forecast across much of the nation," said private forecaster WSI Corp. in a note.
However, the outlook for the next 11 to 15 days still calls for colder-than-average weather in the eastern U.S.

  Traders are also positioning ahead of weekly inventory data, which is due at 10:30 a.m. EDT. Traders and analysts
surveyed by The Wall Street Journal forecast that natural-gas storage levels fell by 47 billion cubic feet last week,
about on-par with the five-year average for this time of year.

  If the storage estimate is correct, inventories as of March 13 totaled 1.5 trillion cubic feet, 53% above levels from
a year ago and 13% below the five-year average for the same week.

  "Unless today's number misses average street ideas of around 49 bcf by more than a 10 bcf margin, we don't expect
much price reaction," said energy-advisory firm Ritterbusch & Associates in a note.

  Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $2.8575/mmBtu, compared with
Wednesday's average of $2.7659. Cash prices at the Transco Z6 hub in New York last traded between $2.60 and $3/mmBtu,
compared with Wednesday's average of $2.8270.


  Write to Nicole Friedman at nicole.friedman@wsj.com


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  (END) Dow Jones Newswires

  March 19, 2015 09:07 ET (13:07 GMT)

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031915 13:07 -- GMT
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