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MTECHTIPS:- Natural gas futures – weekly outlook: August 31 – Sept. 4

MTECHTIPS:- Natural gas futures – weekly outlook: August 31 – Sept. 4

Natural gas futures regained strength on Friday, as forecasts for warm weather across key consumption regions of the U.S. in the week ahead boosted demand expectations for the fuel. On the New York Mercantile Exchange, natural gas for delivery in October tacked on 5.1 cents, or 1.91%, to end at $2.715 per million British thermal units. For the week, the October natural gas contract inched up 4.4 cents, or 0.67%, as market players weighed shifting weather forecasts to assess the outlook for U.S. demand and supply levels. Updated weather forecasting models released Friday showed that most parts of the southern and western U.S. will be engulfed by hot temperatures in the coming days. However, cooler weather was expected across most parts of the Great Lakes, Northeast and Midwest-regions as the week progresses. Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Natural gas accounts for about a quarter of U.S. electricity generation. On Thursday, futures lost 3.9 cents, or 1.44%, to close at $2.664 after data showed that U.S. natural gas supplies rose more than expected last week. According to the U.S. Energy Information Administration, natural gas storage rose by 69 billion cubic feet last week, above expectations for an increase of 59 billion and following a build of 53 billion cubic feet in the preceding week. Supplies rose by 77 billion cubic feet in the same week last year, while the five-year average change is an increase of 61 billion cubic feet. Total U.S. natural gas storage stood at 3.099 trillion cubic feet, 18.3% higher than during the same week a year earlier and 2.9% above the five-year average for this time of year. Last spring, supplies were 55% below the five-year average, indicating producers have made up for all of last winter’s unusually strong demand..

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