--Natural-gas futures fall for third-straight session
--Forecasts see mild temperatures in June
--Nymex gas falls 0.6% to $4.148/MMBtu
By Jerry A. DiColo
NEW YORK--Natural-gas futures fell Wednesday for the third-straight session as traders focus on forecasts for mild June weather across the U.S. that could crimp fuel demand.
Natural gas for June delivery settled 2.6 cents, or 0.6%, lower at $4.148 a million British thermal units on the New York Mercantile Exchange. The June contract expired at settlement Wednesday, and the more heavily traded July contract settled 4 cents lower at $4.184/MMBtu.
Hot weather is expected across much of the U.S. over the next few days, with temperatures forecast near 90 degrees in New York and the high 80's in Chicago. But after this week, mild temperatures are seen returning for the first weeks of June, according to private forecasters.
"The hot weather in the last few days of May--since it's only a couple of days--the market looks to have already adjusted to it," said Gene McGillian, a broker and analyst at Tradition Energy.
Commodity Weather Group LLC said weather in the eastern half of the U.S. "looks rather benign with seasonable to even cool temperatures" in the next six to 15 days.
Gas traders keep close watch on weather forecasts in the summer for signs of rising demand for gas-fired electricity as homes and businesses turn on air conditioning. Electricity generation accounts for 39% of U.S. gas demand.
After rising as high as $4.261/MMBtu last week, natural-gas futures have stalled as investors await better indications on temperatures across the U.S. this summer.
On Thursday, analysts and traders will turn their attention to weekly inventory data from the U.S. Energy Information Administration. The data, scheduled for release Thursday morning, typically offers the best weekly reading of gas supply and demand.
The EIA is expected to report that 88 billion cubic feet of gas were added to storage during the week ended May 24, according to the average prediction of 13 analysts and traders in a Dow Jones Newswires survey.
The EIA is scheduled to release its storage data Thursday at 10:30 a.m. EDT.
If the storage estimate is correct, inventories as of May 24 will total 2.141 trillion cubic feet, about 3.9% below the five-year average and 24% below last year's level for the same week.
-Write to Jerry A. DiColo at [email protected]