June 6:
NEW YORK--Natural-gas prices rose to a fresh one-month high Friday on expectations of robust demand for the fuel amid hotter-than-average weather this month.
Natural gas for July delivery settled up 0.9 cent, or 0.2%, at $4.710 a million British thermal units on the New York Mercantile Exchange, the highest settlement since May 7.
Prices rose 3.7% this week, despite government storage data showing a larger-than-expected increase in supplies.
Though producers added more natural gas to storage than analysts had anticipated, supplies are still 37% below the five-year average for the week.
Natural-gas stocks were heavily drawn down this winter amid record demand for the heating fuel. Larger-than-average injections will still be needed in the coming weeks and months to replenish supplies to average levels before next winter.
Though injections have been consistently large in recent weeks, above-average temperatures in late June are expected to increase demand for natural gas and divert supplies away from storage. Hot weather raises demand for gas-powered electricity to fuel air-conditioning units.
Though temperatures are expected to be mild in the first half of June, "traders are looking ahead to the second half of June, which is expected to be fairly hot," said Aaron Calder, analyst at Gelber & Associates in Houston, in a note Friday.
At current prices, power plants that can switch away from natural gas to coal have already done so, Mr. Calder wrote. "The question is... how much cooling demand will we have to get before we start to use natural gas?"
Source: http://online.wsj.com/article/BT-CO-20140606-709339.html?
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