U.S. natgas futures edge off from six-week high
* Front month hits six-week high on Tuesday * Cold weather still on tap in long-term outlooks * Nuclear outages running above normal By Eileen Houlihan NEW YORK, March 6 (Reuters) - U.S. natural gas futures edged lower on Wednesday, slipping in some profit-taking after climbing to a six-week high on Tuesday as cold weather blanketed much of the nation. In addition, traders said still-bloated inventories were adding more weight to the downside despite forecasts for more cold next week and a high number of nuclear power plant outages. As of 9:23 a.m. EST (1423 GMT), front-month April natural gas futures on the New York Mercantile Exchange were at $3.512 per million British thermal units, down 1.7 cents, or less than 1 percent. The nearby contract rose Tuesday to a six-week high of $3.594. Cold late-winter weather has helped push the front contract up about 12 percent in a little over two weeks. Last week's 5 percent gain was the biggest weekly run in six weeks. Technical traders noted the contract had broken some key trendline and moving average resistance on the way up, turning the chart picture slightly bullish. Forecaster MDA Weather Services called for normal or below-normal readings across much of the country in its one to five-day outlook. The latest National Weather Service six to 10-day forecast issued on Tuesday called for below-normal temperatures for a little more than the eastern half of the nation, with normal or above-normal readings in the West. Nuclear outages totaled about 15,000 megawatts, or 15 percent of U.S. capacity, down from 15,300 MW out on Tuesday and 18,400 MW out a year-ago, but up from a five-year average outage rate of about 13,700 MW. ABOVE-AVERAGE STORAGE DRAW U.S. Energy Information Administration data last week showed domestic gas inventories fell the prior week by 171 billion cubic feet to 2.229 trillion cubic feet. The weekly draw came in well above the five-year average drop for that week and storage is now 12 percent below last year's record high levels, but it is also 16 percent above the five-year average level. Withdrawal estimates for this week's storage report range from 120 bcf to 140 bcf versus a 92 bcf draw in the same week in 2012 and a five-year average drop for that week of 107 bcf. Most analysts expect storage to end the heating season at about 2 tcf, or 16 percent above average, but 19 percent below last winter's record-high finish of 2.48 tcf. OUTPUT COULD BE STARTING TO SLOW Baker Hughes data last week showed the gas-directed drilling rig count fell for the fourth time in five weeks, dropping by eight to 420. The gas drilling rig count is hovering just above the 13-1/2-year low of 413 hit in early November, but production is still high. Also the EIA said last week that gross natural gas output in December slipped slightly from November's record high, the first time in four months that production failed to set a new peak. But most analysts pegged the decline to cold weather in the Southwest that likely froze wells and not producers intentionally curbing dry gas flows. The EIA expects marketed gas production in 2013 to hit a record high for the third straight year.
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