Natural Gas Falls Due to Mild Weather Forecast
Last week was fairly turbulent for natural gas prices, on Monday they opened at 3.850, jumped sharply on Tuesday to 3.992 and eventually hit a high of 4.024 on Thursday. However, the price fell sharply on Friday reaching a low of 3.840 before closing at 3.903.
The drop on Friday came after updated weather forecasting models suggested that the weather would remain mild in most of the US for the next few weeks. As a result there will be less demand for gas as people stop using air conditioning and don’t yet need heating.
As natural gas inventories are continuing to grow, unless there is a drastic change in the weather forecast the price of gas is unlikely to climb in the coming week. However, if temperatures go either up or down then the price could rise again.