Natural-gas prices erased some losses but continued trading lower
Thursday as weekly inventory data showed that stockpiles of the fuel
fell more than expected but the market remains oversupplied.
Natural-gas
futures for March delivery recently traded down 4.7 cents, or 2.4%, at
$1.895 a million British thermal units on the New York Mercantile
Exchange, up from as low as $1.866/mmBtu before the report’s release.
A
growing oversupply of natural gas due to robust production and mediocre
demand has weighed on prices this winter. Warmer-than-normal weather in
the eastern U.S. has reduced the need for natural gas to heat homes and
offices.
Stockpiles of natural gas fell by 158 billion cubic
feet to 2.706 trillion cubic feet in the week ended Feb. 12, the Energy
Information Administration said Thursday. Analysts surveyed by The Wall
Street Journal had expected the agency to report a 154 bcf withdrawal.
The stockpile draw was smaller than the five-year average drain for the week of 170 bcf.
"The
158-bcf net withdrawal for last week was ...still somewhat bearish on a
seasonally adjusted basis,” said Tim Evans, analyst at Citigroup Inc.,
in a note. "With forecasts for mild temperatures ahead, we’d also
suspect that any upward price reaction off the storage report may prove
short-lived.”
Inventories as of Feb. 12 stood 25% above levels from a year ago and 26% above the five-year average for the same week.
(Wall Street Journal)