FYI Investing.com - Natural gas futures declined for the second consecutive day on Tuesday, as investors continued to book profits from a recent rally that took prices to the highest level since August 2011.
On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD4.048 per million British thermal units during U.S. morning trade, down 0.85% on the day.
Nymex gas prices fell by as much as 1.25% earlier in the day to hit a session low of USD4.029 per million British thermal units.
The May contract rallied to USD4.177 per million British thermal units on Monday, the strongest level since August 2, 2011, amid easing concerns over U.S. inventory levels.
Total U.S. natural gas in storage fell to 1.687 trillion cubic feet last week, 32% lower than last year at this time and 2.1% below the five-year average.
Gas inventories had held above the five-year average since September 2011.
Early withdrawal estimates for this week’s storage data range from 20 billion cubic feet to 36 billion cubic feet.
Inventories rose by 11 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a rise of 15 billion cubic feet.
Meanwhile, weather forecasters predicting mild temperatures in the key Midwest and East Coast markets also weighed.
Natural-gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts for early-spring cooling needs.
Nymex gas prices have risen sharply in recent weeks, gaining almost 25% since mid-February, boosted by calls for colder temperatures in major consuming regions across the U.S. that helped tighten the market.
Still, some analysts have warned that further gains may be limited with spring's low-demand shoulder season looming.
The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.
Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.