Natural gas stockpiles expanded last week by more than the seasonal average as mild weather reduced the need for power to run air conditioners, according to analyst forecasts compiled by Bloomberg.
U.S. inventories increased 69 billion cubic feet to 3.011 trillion in the seven days ended Aug. 9, based on the median of 18 estimates. The five-year average increase for the period is 42 billion cubic feet, Energy Information Administration data show. Supplies advanced by 20 billion a year earlier.
The estimates were for gains ranging from 62 billion to 79 billion cubic feet. The EIA, the statistical arm of the Energy Department, is scheduled to release its weekly stockpile report at 10:30 a.m. tomorrow in Washington.
Temperatures were below normal from the East Coast through the Great Plains last week, according to MDA Weather Services in Gaithersburg, Maryland. Gas prices have slumped from a 21-month high on May 1 as unusually mild summer weather limited cooling needs.
Supplies jumped by 96 billion cubic feet the previous week, including 14 billion that was reclassified to working gas from base gas, the EIA said. Analysts had expected a gain of 79 billion for the period.
“After last week’s 96 reclassification head-fake, the market is going to be a little nervous about this one,” Drew Wozniak, vice president of market research at United-ICAP, a brokerage in Jersey City, New Jersey, said in a note to clients today. “We are likely to have a bear number next week, so the question is, will we touch $3 by the end of the month.”
Natural gas futures for August delivery rose 5.7 cents, or 1.7 percent, to settle at $3.342 per million British thermal units on the New York Mercantile Exchange. Prices fell 3.5 percent last week after sliding to $3.129 on Aug. 8, the lowest intraday price since Feb. 15.
Power producers will account for 32 percent of gas demand in 2013, according to the EIA.
Gas supplies in the week ended Aug. 2 were 0.7 percent above the five-year average, flipping to a surplus to the historical norm for the first time since March 22, EIA data show. A deficit to year-earlier levels narrowed to 9.2 percent from 11.5 percent the previous week.
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