MTECHTIPS;-U.S. natural gas extends losses after tallying worst day

MTECHTIPS;-U.S. natural gas extends losses after tallying worst day since January

MTECHTIPS-U.S. natural gas futures edged lower on Wednesday, extending their biggest one-day loss since late January amid bearish weather forecasts. U.S. natural gas for June delivery slumped 2.3 cents, or around 0.7%, to $3.207 per million British thermal units by 9:30 AM ET (13:30 GMT). Prices of the heating fuel sank 11.9 cents, or around 3.5%, on Tuesday, the biggest daily decline since January 31. Natural gas futures are down roughly 6% so far this week as the latest U.S. weather model called for mild temperatures over the next two weeks, which should reduce demand during that time. Prices of the fuel have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on spring heating demand. Gas use typically hits a seasonal low with spring’s mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning. Nearly 50% of all U.S. households use gas for heating. Total natural gas in storage currently stands at 2.301 trillion cubic feet, according to the U.S. Energy Information Administration, 13.9% lower than levels at this time a year ago but 12.0% above the five-year average for this time of year. The EIA’s next storage report due Thursday is expected to show a build in a range between 55 and 63 billion cubic feet in the week ended May 12. That compares with a gain of 45 billion cubic feet in the preceding week, an increase of 73 billion a year earlier and a five-year average rise of 87 billion cubic feet.
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