Investing.com - U.S. natural gas prices struggled near the lowest level in almost five months on Tuesday, as forecasts for warm weather across key consumption regions of the U.S. in the week ahead dampened demand expectations for the fuel.
Natural gas for delivery in October on the New York Mercantile Exchange inched up 0.7 cents, or 0.29%, to trade at $2.580 per million British thermal units during U.S. morning hours.
A day earlier, U.S. gas futures fell to $2.562, a level not seen since April 30, before ending down 3.2 cents, or 1.23%, at $2.573.
Demand for natural gas is expected to be moderate this week as warmer weather moves across the eastern part of the U.S. Meanwhile, weather in the west will be warmer before cooling off as the week progresses.
Summer heat has waned and cooler temperatures beckon with the approach of autumn. Natural gas accounts for about a quarter of U.S. electricity generation.
According to the Energy Information Administration, natural gas storage increased by 73 billion cubic feet last week, matching forecasts. Supplies rose by 90 billion cubic feet in the same week last year, while the five-year average change is an increase of 75 billion cubic feet.
Total U.S. natural gas storage stood at 3.334 trillion cubic feet, 15.8% higher than during the same week a year earlier and 4.1% 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.
The EIA's next storage report slated for release on Thursday, September 24 is expected to show a hefty build of approximately 105 billion cubic feet for the week ending September 18.
That compares with builds of 96 billion cubic feet in the same week last year, while the five-year average change for the week is an increase of 83 billion cubic feet.
Elsewhere on the Nymex, crude oil for delivery in November tumbled $1.16, or 2.48%, to trade at $45.80 a barrel, while heating oil for October delivery slumped 1.38% to trade at $1.493 per gallon.