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March natural gas reverses 2.5 cents lower after storage report

After gaining 4.3 cents in the prior session, NYMEX March natural gas futures ended Thursday, Feb. 22, slightly lower on profit taking and selling in the wake of the latest weekly storage data.

Trading from $2.620/MMBtu to $2.670/MMBtu, the NYMEX front-month March natural gas futures contract settled at $2.634/MMBtu, down 2.5 cents.

March natural gas options expire at the close of business Feb. 23 while the March gas futures contract rolls off the board Feb. 26. April natural gas futures settled Feb. 22 at $2.676/MMBtu, down 0.5 cent.

Natural gas futures probed the downside in early trading Thursday, with losses accelerating after the U.S. Energy Information Administration reported a net 124 Bcf was pulled from natural gas storage in the Lower 48 during the week ended Feb. 16.

The withdrawal, which was within the wider range of trader and analyst estimates but came in above a consensus expectation of 116 Bcf, compared to the 92-Bcf year-ago withdrawal and the 145-Bcf five-year average pull.

The pull left total U.S. working gas supply at 1,760 Bcf, or 609 Bcf below the year-ago level and 412 Bcf below the five-year average storage level of 2,172 Bcf.

According to its latest Short-Term Energy Outlook, the EIA sees stocks ending the traditional withdrawal season on March 31 at 1,429 Bcf, or 17% below the five-year average, amid rising production. However, if withdrawals maintain the five-year average pace, end-of-season inventories could reach below 1,300 Bcf.

With the peak of the winter heating season in the rearview mirror, seasonable to colder-than-normal weather is not expected to bring frigid conditions but could still inspire late-season heating demand that would encourage storage withdrawals.

During the six- to 10-day period, the National Weather Service forecasts show below-average temperatures over much of the West and areas of the central U.S., with the eastern half of the U.S. looking at above-average temperatures.

The eight- to 14-day outlook is calling for generally normal conditions across the East, Midwest and most of Texas. Below-normal temperatures are projected for areas of the central U.S. and all of the West.

Market prices and included industry data are current as of the time of publication and are subject to change. For more detailed market data, including power, natural gas index prices, as well as forwards and futures, visit our Commodities pages.