The NYMEX April natural gas futures contract settled 0.4 cent lower at $3.645/MMBtu Tuesday, after a day of rangebound trading in which cooler weather in the forecasts prevented prices from falling off more dramatically.
Kilduff Report analyst Mike Fitzpatrick also noted that Thursday's anticipated storage withdrawal could be supportive, as it is likely to show another triple-digit drawdown that will expand the year-on-year storage deficit.
George Ellis, director of energy marketing with Bank of Montreal, said he does not expect any further rally will sustain itself, despite the short-term support, as the chances for major winter weather from here are quickly winding down.
Fitzpatrick added, "As prices grind lower through the upcoming shoulder demand period, we would look for an opportunity to get long the winter strip for next year. This year has shown that demand for natural gas is on the rise, setting last year's lows as the likely floor in prices for some time."
The contract traded Tuesday between $3.62/MMBtu and $3.676/MMBtu.
