U.S. natgas futures rise, remain under Monday's 20-month high
* Front month hit highest mark since July 2011 on Monday * Below-normal temperatures remain on tap for consuming regions * Nuclear plant outages still above five-year average By Eileen Houlihan NEW YORK, April 16 (Reuters) - U.S. natural gas futures edged higher early on Tuesday, lifted again by forecasts for continued below-normal temperatures in consuming regions of the nation, but remaining under Monday's highest mark in more than 20 months. A tightening supply picture and a slew of nuclear power plant outages also helped boost prices. Gas futures are up about 34 percent since mid-February, with cold late-winter weather putting a huge dent in inventories while above-normal nuclear plant outages and stronger price expectations added momentum. But most traders expect further upside to be difficult, with milder, spring-like temperatures likely to curb heating demand by late-month before warmer weather sparks any early cooling demand. As of 9:26 a.m. EDT (1326 GMT), front-month May natural gas futures on the New York Mercantile Exchange were at $4.152 per million British thermal units, up 1.5 cents, or less than 1 percent, after rising to $4.29 on Monday, the highest level for a nearby contact since late July, 2011. The latest National Weather Service six- to 10-day forecast issued on Monday again called for below-normal temperatures for about the eastern half of the nation and above-normal readings in the West. Nuclear outages totaled 27,300 megawatts, or 27 percent of U.S. capacity, down from 27,500 MW out on Monday and 27,500 MW out a year ago, but up from a five-year average outage rate of 24,300 MW. INVENTORY DRAW BELOW EXPECTATIONS, ABOVE AVERAGE Last week's gas storage report from the U.S. Energy Information Administration showed domestic inventories fell the prior week by 14 billion cubic feet, below Reuters poll estimates for a 21 bcf draw but above the year-ago gain of 11 bcf and the five-year average build of 15 bcf for that week. Domestic gas inventories of 1.673 trillion cubic feet are nearly 33 percent below last year's record high and nearly 4 percent below the five-year average. Inventories started the heating season at record highs, but two weeks ago stocks slid below the five-year norm for the first time since September 2011. But last week's decline should be the last of the heating season, with estimates for this week's report all looking for a modest build. Early injection estimates for this week's report range from 22 bcf to 55 bcf versus a 21-bcf build during the same week last year and a five-year average rise for that week of 39 bcf. Total gas pulled from storage this winter is about 2.25 tcf, roughly 770 bcf, or 52 percent, more than last year and about 15 percent more than the normal heating-season draw. Baker Hughes data released on Friday showed the gas-directed drilling rig count rose 2 from the prior week's 14-year low, to 377.
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