Natural-gas futures topped $5 per million British thermal units on Friday, a level not seen since mid-2010, with prices ready for a weekly gain of roughly 15% as severe cold boosted demand prospects for the heating fuel, according to a MarketWatch report
Up for a fourth-consecutive session, February natural gas (NGG14) rallied 27.5 cents, or 5.8%, to $5.005 per million British thermal units on the New York Mercantile Exchange. Futures prices were up more than 15% for the week, and they haven't settled above $5 since June 2010, according to FactSet data tracking the most-active contracts.
According to MarketWatch, a report from the U.S. Energy Information Administration on Thursday showed that supplies of natural gas in storage fell 107 million cubic feet for last week, generally matching market expectations.
Frigid temperatures in the U.S. have contributed to higher consumption of natural gas as a heating fuel and weather forecasters say persistently below average temperatures won't go away any time soon.
There is increasingly little doubt that U.S. natural-gas inventories will start February below 2 trillion cubic feet, said John Kilduff, publisher of the Kilduff Report. "The realization that the demand will persist has set in."
As of the week ended Jan. 17, natural gas in storage stood at 2.423 trillion cubic feet, according to the EIA. That's down 598 billion cubic feet from last year and 369 bcf below the five-year average.
Natural gas has been the best performing commodity in the S&P GCSI so far in 2014 -- up 8.6%, according to Jodie Gunzberg, vice president of Commodity Indices at S&P Dow Jones Indices.
Back on Nymex, February heating oil tacked on almost 3 cents, or 0.9%, to $3.10 a gallon, also buoyed by the cold weather forecasts and trading up 2.7% for the week.
February gasoline (RBG4) was down a penny, or 0.4%, at $2.65 a gallon, up 1.1% from a week ago.
At the retail level, the average price for a gallon of regular gasoline stood at $3.288 on Friday, up from $3.264 a month ago, according to AAA. Experts expects higher prices next month but also a decline for the year.
"We will see a kinder, gentler year," with the annual average down 5 cents to 10 cents from 2013's $3.49 a gallon, said Denton Cinquegrana, chief oil analyst at the Oil Price Information Service.