Natural gas prices in U.S. fell to 10-month lows due to forecasted milder weather

This Thursday, a notable fall in U.S. natural gas futures was registered, with prices hitting the lowest levels in 10 months. It happened due to weather forecasts showing higher temperatures over the next two weeks. At the same time, a larger-than-expected storage draw has less impact on gas prices.

The prices continued to fall even despite a statement made by the U.S. Energy Information Administration (EIA) noting that utilities used 201 billion cubic feet of gas from storage because of severe cold last week. The used volume turned out to be larger than 201 billion cubic feet previously predicted by analysts in a Reuters poll.

As it was said by Robert DiDona from Energy Ventures Analysis, the forecasted milder weather became more important for the market than the storage report.

Due to expected higher temperatures, Refinitive suggests there would be a decline in average U.S. gas demand, including exports. The suggested decrease would be from this week’s level of 142.6 billion cubic feet per day to 111.6  billion cubic feet next week.