The NYMEX April natural gas futures contract fell 5.6 cents Friday to settle at $4.313/MMBtu as traders looked ahead to lower shoulder-season demand in the coming weeks.
Over the past four sessions, the contract has shed a total of 22.3 cents, or about 5%.
"I think we're looking like we're trying to shake off winter," said INTL FC Stone broker Tom Saal. "We are trading for April, and the expectations are that April will probably show less colder weather than March."
While another wave of colder-than-normal weather is on its way to major US consuming regions in the near term, Barclays Capital analyst Shiyang Wang said "the forward curve seems unmoved ... as the shoulder season is just around the corner."
Moreover, longer-term weather forecasts have moderated, showing below-average temperatures in the US National Weather Service's six- to 10-day forecast giving way to largely normal to above-normal conditions in the eight- to 14-day outlook.
And while storage levels are poised to end the winter at lows not seen in over a decade, "the market remains confident that the storage deficit can be narrowed significantly by the end of the injection season by production growth and the elasticity of natural gas power burn," Wang added.
The contract traded Friday between $4.286-$4.378/MMBtu. The NYMEX settlement is considered preliminary and subject to change until a final settlement price is posted at 7 pm EDT (2300 GMT).
