Wednesday, 4 January 2012


Natural Gas :-

According to our sharetips expert, Natural gas prices declined in the first trading session of 2012 on Tuesday, trading below USD3.00 per million British thermal units for the second consecutive session as lingering concerns over elevated inventory levels continue to dampen sentiment on the heating fuel.

On the New York Mercantile Exchange, natural gas futures for February delivery traded at USD2.968 per million British thermal units during U.S. morning trade, slumping 0.15%.

It earlier fell by as much as 1.17% to trade at USD2.937 per million British thermal units, the lowest since September 10, 2009. On Friday, the front-month gas contract settled below USD3.00 during the winter for the first time in nearly a decade.

NYMEX trading remained closed on Monday due to the New Year's holiday.

Natural gas prices kicked off the new year on a downbeat note after industry weather group MDA Federal said that the U.S. Northeast was expected to return to milder weather after a brief cold-spell this week.

In a report published earlier the weather group said that temperatures in the northern U.S. from the Great Plains to the Northeast may be five to eight degrees Fahrenheit above normal from January 8 to January 12, dampening hopes for a pick up in heating demand.

'The forecast here remains quite warm across most of the North with only some detail differences expected since late last week,' MDA forecasters said in a report.

Prices have closely tracked weather forecasts in recent weeks. Above-normal winter temperatures reduce the need for gas-fired electricity to heat homes, dampening demand for natural gas.

Concerns over record-high supply levels in the U.S. also added to selling pressure. Currently, total U.S. natural gas supplies stand at 3.548 trillion cubic feet, up 9.1% from a year earlier and 13.7% above the five-year average for this time of year.

Gas futures typically climb during the winter months, as temperatures fall and demand for heating fueled by natural gas rises. But mild weather coupled with high production levels have kept prices depressed in recent weeks.

Natural gas prices plunged 32% in 2011, as high U.S. inventories and increasing domestic natural gas production weighed on prices.

Futures dropped nearly 15% in December alone, as warmer-than-normal winter weather limited heating demand.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in February rallied 2.8% to trade at USD102.50 a barrel, while heating oil for February delivery surged 3.75% to trade at USD3.019 per gallon.

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