Investing.com - U.S. natural gas prices rose on Tuesday, as traders continued to weigh shifting weather forecasts to assess the outlook for U.S. demand and supply levels.
Natural gas for delivery in October on the New York Mercantile Exchange rose 3.7 cents, or 1.39%, to trade at $2.692 per million British thermal units during U.S. morning hours. U.S. markets were closed on Monday for the Labor Day holiday.
Updated weather forecasting models showed that most parts of the southern U.S. will be engulfed by hot temperatures in the coming days.
However, cooler weather was expected across most parts of the Great Lakes, Northeast and Midwest-regions 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 U.S. Energy Information Administration, natural gas storage rose by 94 billion cubic feet last week. The data included a reclassification from working gas to base gas of 8 billion cubic feet, which brought the number to 86 billion cubic feet.
Analysts had expected an increase of 88 billion cubic feet last week. Supplies rose by 79 billion cubic feet in the same week last year, while the five-year average change is an increase of 60 billion cubic feet.
Total U.S. natural gas storage stood at 3.193 trillion cubic feet, 18.3% higher than during the same week a year earlier and 4.0% 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 10 is expected to show a build of approximately 80 billion cubic feet for the week ending September 4.
That compares with builds of 90 billion cubic feet in the same week last year, while the five-year average change for the week is an increase of 63 billion cubic feet.
Elsewhere on the Nymex, crude oil for delivery in October lost 47 cents, or 1.02%, to trade at $45.58 a barrel, while heating oil for October delivery dropped 0.75% to trade at $1.584 per gallon.