Reuters reported that US natural gas futures edged higher, lifted by forecasts calling for a return of warmer weather in consuming regions of the nation and an increase in tropical activity.
While still out in the Atlantic near the Lesser Antilles, Tropical Storm Isaac was expected to become a hurricane in the next few days as it marches through the Caribbean.
Most forecast tracks show it veering away from US energy operations in the Gulf of Mexico, but some traders remained cautious, saying it is too early to know exact tracks.
One Texas based trader said that "We've got a storm risk with Isaac and a weather risk from the warm weather. Everyone is also waiting to see what tomorrow's EIA storage data shows."
Persistent high nuclear power plant outages were also helping to support natural gas prices, but most observers expect futures to have a hard time breaking back above USD 3 per million British thermal units, the level where gas loses much of its appeal over coal for power generation.
The nearby contract peaked at USD 3.277 in late July 2012, its highest mark since December 2011. In the cash market, gas bound for the NYMEX delivery point Henry Hub NG W HH in Louisiana was heard flat on the day at USD 2.80 on volume near 498 million cubic feet. But early deals firmed to just 1 cent under the front month, from a 7 cent discount.
Gas on the Transco pipeline at the New York city gate NG NYCZ6 was heard up 1 cent at USD 2.87 on volume near 167 mmcf. The National Weather Service's six to 10 day outlook issued again called for above normal temperatures across much of the nation, with below normal readings only on the West Coast.
On the nuclear front, total outages were about 7,800 MW or 8% of US capacity, down from about 8,100 MW out but up from 7,400 MW out a year ago and a five year outage rate of about 6,000 MW.
Source - Reuters
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