Natural gas dropped on Monday, snapping two days of gains, as forecasting agencies projected close to or above-seasonal readings late this week.
Natural gas for delivery in February traded 2.68% lower at $2.867 per million British thermal units at 8:58 GMT, having shifted in a daily range of $2.934-$2.865. The energy source edged up 0.65% on Friday to $2.946.
According to NatGasWeather.com, US natural gas demand will be high-to-moderate compared to normal through January 17th, with a slightly warmer trend early next week, turning neutral towards the end of it.
Colder Canadian air will flow into the Great Lakes and interior Northeast during the next several days, bringing areas of light snow and rain. Meanwhile, the southern and eastern US will become milder compared to last week as winds headed southward will arrive earlier than the system and will pull up daily highs above freezing levels.
The West will welcome a series of Pacific storms during the week as they will be accompanied by milder conditions, but also areas of rain and snow.
Excluding the far northeastern regions, which will be hit by a cold blast on Thursday, temperatures over the majority of the US will reach seasonal or higher readings later this week, NatGasWeather.com reported.
The above-seasonal temperatures will maintain their reign over most of the country until mid-next week as mild Pacific weather systems travel through the country. However, colder Canadian air will find its way back to the northern US and push down temperatures to seasonal levels. Much colder Arctic air will gather over southern Canada that would require observing during the last week of this month.
Temperatures
According to AccuWeather.com, temperatures in New York tomorrow will range between 20 and 29 degrees Fahrenheit, below the average of 27-38, before increasing to as much as 44 degrees on January 18th. Chicago will range between 9 and 21 degrees today, 10 beneath the normal, and temperatures are poised to remain colder than usual until Friday, when readings will hit seasonal levels.
Down South, Houston will see the mercury range between 43 and 58 degrees today, compared to the average of 45-63, before temperatures climb to seasonal levels on January 17th. On the West Coast, Los Angeles will range between 50 and 71 degrees tomorrow, compared to the usual 48-68, with readings projected to stay slightly above normal through January 21st.
Supplies
The Energy Information Administration reported on Thursday that US natural gas inventories slid by 131 billion cubic feet (bcf) during the week ended January 8th, compared to analysts’ projections for a drop of 121 bcf. Supplies declined by 191 billion cubic feet during the same week a year earlier.
Total gas held in US storage hubs amounted to 3.089 trillion cubic feet, narrowing the deficit to the five-year average of 3.156 trillion to 2.1% from 2.5% during the previous week. Stockpiles stood at 2.839 trillion cubic feet a year ago, 8.8% below current levels.
Pivot Points
According to Binary Tribune’s daily analysis, February natural gas futures’ central pivot point stands at $2.941. In case the contract penetrates the first resistance level at $2.995 per million British thermal units, it will encounter next resistance at $3.043. If breached, upside movement may attempt to advance to $3.097 per mBtu.
If the energy source drops below its first support level at $2.893 per mBtu, it will next see support at $2.839. If the second key support zone is breached, the power-station fuel’s downward movement may extend to $2.791 per mBtu.
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